Proceedings of the Standing Senate Committee on
Agriculture and Forestry
Issue 31 - Evidence
TRURO, Thursday, February 14, 2002
The Standing Senate Committee on Agriculture and Forestry met this day at 9:00 a.m. to examine international trade in agriculture and agri-food products, and short-term and long-term measures for the health of the agricultural and the agri-food industry in all regions of Canada.
Senator Leonard J. Gustafson (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, this morning we have before us Mr. Jean-Louis Daigle, Director of the Eastern Canada Soil and Water Conservation Centre.
Welcome, Mr. Daigle. We look forward to your presentation.
Mr. Jean-Louis Daigle, Director, Eastern Canada Soil and Water Conservation Centre: Mr. Chairman, it is quite a pleasure for me, to be here.
Honourable senators and people from the media, I attended these hearings yesterday, and it was very interesting to listen to the discussion. I would also say that last night we all ended up at the same pub, and I was a little surprised. Things happen those ways sometimes without planning, so perhaps I will get some tough questions.
I am a professional engineer by training, and also a professional agrologist. I was born on a potato farm up in the Drummond area of New Brunswick; not Drummondville, Quebec.
[Translation]
I will give you a brief overview of my presentation. First, the role of the Soil Conservation Centre: What is soil conservation and what are the environmental stakes? You were asking yesterday if there are any solutions about policy instruments. What tools could be used in the agri-environment sector to produce a change towards sustainable agriculture?
I will also speak about our research and development needs, about the drought, about the position of the Soil Conservation Centre and about the challenges we face as far as partnerships are concerned.
Grand-Sault, Grand Falls B in Nouveau-Brunswick is an area upstream of the Saint John River. You can see the arrow indicating ``Eastern Canada''. That is where we are. And Saint-André is right in the middle of a rural community: here, on the B photograph, where there is a very intensive potato production. The land is rather hilly and the top soil rather thin. In the background of the picture, you can see the lands leading to the State of Maine, which means that we are very close to the U.S. border and close to Quebec. As Paul-Émile said yesterday, it is the Republic of Madawaska.
In New Brunswick, the area upstream of the Saint John Valley is called ``Potato Valley.'' The Soil Conservation Centre has been created to answer the needs of producers who are asking for more information about soil conservation.
The Senate Report on Soil Degradation of 1984 was chaired by Senator Sparrow. When he came in New Brunswick, let me tell you that many farm organizations told him that they needed more information; that the issue was not only money but also information.
Farmers wanted to raise public awareness to their issues. Later on, thanks to all the efforts of local organizations located upstream of the Saint John River, a fund was set up, in 1991. Since then, a 20 year partnership has been established with the following partners: the University of Moncton, the Edmunston Campus, the Government of Canada through Agriculture Canada, and Canada Trust, which is now part of a tripartite agreement. We are celebrating our 20th anniversary.
The role of the Centre is to collect information. We try to locate information wherever it is, whether it be in Eastern Canada, in the U.S. or in Europe. Another role of the Centre is to educate the general public as well as farmers, using existing resources.
We play a networking role, as well as a role of catalyst with the parties and departments involved, which sometimes requires an independent member to bring them to the table.
As far as technological transfer is concerned, we try to make the results of research available through our various mechanisms. We provide expert support to farm organizations as well as to the Department of Agriculture and the Environment about soil and water conservation. Recently, we have started to look at partnerships.
As to our means of communications, since we are a small centre covering only Eastern Canada, our main resource is the Internet. Of course, since we come under the University of Moncton, our Internet site has to be as bilingual as possible. We are beginning to have some national and international visibility through our Web site.
We also deal with requests from other countries and we are starting to develop case studies. Part of our Web site deals with best management practices and we provide real life examples of conservation measures taken by farmers.
We have a partnership project with the Climate Change Action Fund. A first document has been published on the ``Climate Times''. Our role is to collect as much information as possible through conferences and workshops.
As to our clients — this is in the next document — they come first of all from New Brunswick, where about 50 per cent of information requests originate. The Atlantic region represents 80 per cent of our clientele, but there is growing demand from other provinces.
Who are those clients? In the past, they used to be mainly government organizations, at the level of extension services, but now it is mainly the private sector. This means that we get requests from farm organizations through their consultants or their staff. Those information services do not include the services of our Web sites and our network activities.
We organize many education activities and we sometimes help partners to develop their own projects, for example, videos.
[English]
The soil and water conservation challenge and environmental issues, from the centre's standpoint soil degradation and erosion, are still primary issues in the Atlantic provinces. We are getting a lot of rainfall and we are getting a lot of runoff. I will come back to that in a few seconds. Water quality and water supplies, of course, are a growing challenge since Walkerton. Municipalities want to have quality of water.
Agricultural non-point source pollution will continue to be a growing challenge for farmers. We can deal with point source, but how do we deal with the agricultural non-point source?
With respect to climate change and variability, that is what is at issue in relation to Kyoto. How will the Kyoto solutions affect us? Not only that, but if agriculture is to be responsible for 20 per cent of the solution, and we are contributing 10 per cent now in terms of greenhouse gases, how will we do it?
With respect to food safety and environmental farm planning, and rural and urban conflicts, I think you heard the comments that were made yesterday.
Soil degradation, from our perspective — and I do not want to go into details here, but coming from the potato belt and from what I have lived through on my dad's farm, that is a serious problem. Sometimes we have suffered the loss of available soil water. We are thinking in terms of irrigation, but have we taken the first step by controlling erosion? Have we captured the rainfall to reduce runoff? Back in 1985, Agriculture Canada estimated that the on-farm cost of erosion is about $40 million a year. Not much has been invested in mitigating that problem, and we have still not counted the off-farm cost.
With respect to water conservation and water management, when we are dealing with drought, the question is how are we to share this water? We know the cost of not sharing it, as you heard through yesterday's presentation. If we want to produce food, that will take water. Our fisheries and oceans departments are concerned about the habitat that they have the power to regulate. They want to maintain a certain minimum water flow. Our farmers want access to some water. Water quality and quantity are interrelated, and we should all know about this situation. Having a water demand for agriculture, the question is will the farmers get that water if the municipality wants it for the fishermen?
The wellhead designation and watershed protection program in New Brunswick, in my opinion, are just about the most powerful regulations that are being set up. How will the river classification system affect our farmers and our rural community? Who will be setting the goals on water quality down the road when we have to deal with Environment Canada through local watershed groups that are promoting higher water quality standards? Will the farmers be sitting at the table? Probably not, because right now, they are not aware of what is happening in that respect.
Agricultural runoff and non-point source pollution impact surface and water quality. I will not get into this because I think Rob Gordon covered it quite well yesterday. Again, it is certainly a concern. If we do not treat our sediment, and if we do not keep our sediments on the farm, sometimes they are the carriers of pesticides. Prince Edward Island has had those experiences. I do not have to give you the details.
In terms of climate change variability and adaptation, I was fortunate to sit on the Climate Change Agricultural table. I have learned quite a bit about such things, and I know that now we must more actively promote soil conservation these days. We have to sell it in other ways, perhaps through the envelope of climate change and adaptation. Agricultural runoff will be a higher risk here in the Atlantic provinces because of the rainfall that we get, and those intense storms. You do not experience that in Saskatchewan, but we get it here. We can get two inches of rain within 25 minutes easily in the New Brunswick potato belt.
Senator Oliver: Did you want to comment on some of these pictures before you finish with it?
Mr. Daigle: Yes. I would like to deal with just the upper one there in the corner. If you look at that picture, that brook is nearly dry in the summer. That is after one of those 25-year storms that we have experienced in Saint-André. We used to get one in 25 years, and now we get one almost every five years, but a smaller area is hit. We get occasional erosion disasters in some very localized areas. This is right in the Saint-André community, five kilometres from the Conservation Centre.
If we are to seriously consider climate change, with these kind of runoff issues we will have to put more conservation work into practice. It is nice to talk about it, but we will have to make sure that the farmer does it, and leaves buffer strips.
With respect to greater flood control, in the east, in the Atlantic region, that means coastal zone flooding. What will happen to our dike land infrastructure system? If there is to be a sea rise, are our dikes ready to withstand that? Perhaps they are ready in the Netherlands, but are we ready here? With respect to crop stress, we will need more irrigation, although not the same sort of irrigation that they have in western Canada. We will need supplemental irrigation, which is different. It is a different approach, different management.
Therefore we must adapt our cropping systems, and farmers will also need to reduce their greenhouse gas emmissions, but one thing that we must deal with — and I will come back to this — is water storage, if we want to irrigate in order to put our agriculture into a sustainable and viable state. My own experience, in dealing with farmers in the Drummond community, in Grand Falls and the upper potato belt, including working for 15 years with farmers, plus my student work, plus trying to convince my dad at the kitchen table, it that it has been a hard time. My dad almost told me to go back to university because I did not know much, until I proved it; I had to prove it step by step on the family farm.
I am indicating land on this diagram that used to be my cousin's farm. The land used to be farmed up and down the hill. Erosion rates were 15, 20, 50 tons per acre per year. We are talking here of long, steep slopes, farming potatoes up and down the hill. That is mining the soils, and we must stop doing that serious soil erosion process. It took almost a generation to change this practice, a time of intensive, almost arm-twisting persuasion of farmers to change their practices, change their attitudes. The reality is that, in the context of global market pressures, the producers have to be survivors; they have bankers telling them that they have to sell enough potatoes, so much so that their crop has to get to the customer in order to meet his contract.
In terms of farm efficiency and land loss to conservation, if we undertake terracing and waterways we are taking 8 to 10 per cent of the land out of production. That has to be replaced, and farmers have accepted that it has to be a compromise. However, looking at land values in Drummond, Grand Falls, New Brunswick, that land is worth around $4,000 an acre, or maybe up to $5,000 if it is available. That $5,000 loss is a cost to the producer. With respect to land accessibility and land tenure, if a farmer is leasing the land, is he interested in investing? Is it the owner's responsibility or is it the responsibility of the guy who leases the land?
With respect to the economics of soil conservation, even in the year 2002 we have not determined that; we have not proven to farmers what the real benefits of soil conservation are. How do we share benefits with society? In 1997, the Soil Conservation Centre did a literary review of environmental policy instruments for environmental protection in agriculture. We were probably five years ahead of our time because not too many people wanted to listen to this kind of thing at that time. However, today, in the context of the agriculture policy framework, it is there.
Why did we do this? Because of the work that was being done in Prince Edward Island. We were trying to help P.E.I. with their policy framework and with their consultation with the round table. Again, there are a lot of things involved here. If we are looking at compliance with the other OECD countries on this subject, there has to be a balance between policies and regulation. We seem to have a tendency to believe that, with less resources, it is up to us to regulate. Keep in mind, however, that with regulation there has to be enforcement; there has to be monitoring. Without that, it will be costly down the road. In other words, would we rather deal with expensive costs or with the court system?
What about voluntary actions? In Europe, they invest money in the voluntary and friendly approach, in other words, getting farmers to buy in by promoting best management practices, or BMPs, environmental farm planning, technical and extension services, which I do not think we have ever explored enough. We need policies to keep people doing the extension, the promotion and the selling out there. It does not get done by itself. Tax benefits and incentive programs will have to be looked at again. With respect to policy instruments, from an economic sense there must be incentives. This is part of what we are trying to promote, and I might add that this report is available now on our Web page. I left a copy for the group here. We are lacking in long term and continuity of programs. We used to have those nice federal-provincial agreements. Farmers could plan ahead. Now they cannot plan any more. We do not know next year whether we will have a program, so how can farmers plan ahead if they do not know what is available? Perhaps we need to look at the mechanism for tax credits for BMP implementation. All kinds of systems exist around the world that I think your group may want to look into. I heard last night that perhaps you will be looking at Europe. I think you might want to look at this whole situation very carefully because there are things to be learned from the older countries. We are still a young country here.
The next heading is ``Support for Common or On-farm Infrastructures.'' I will come back to this with respect to the irrigation and drought issues, but if we have programs through Environment Canada for municipal upgrades for water systems and all the rest of it, what are we doing with our farming community? What is the proper balanced approach? Do we help them with irrigation, water supplies, or manure storage? Are there programs in existence? Some provinces have programs; other provinces do not.
We need to target some programs at especially the highly sensitive designated watershed or municipal wellhead zones. We have regulations in New Brunswick around the Edmundston area, and Paul-Emile has talked about that a bit, very superficially, but there is quite a challenge there. Are we intending to close agriculture, forgetting that we might want to have trees planted everywhere, and thus have a good water for the municipality or town? How is this resource shared? What are the incentives for such sharing?
Public education will be important for technical services as well as research. Do we want to focus everything on research but not transfer the information? Providing this information will be something for you to think about, because the technical service is important. Soil conservation and land management do not get on the ground without help. It needs technical help and trained help. I went through that myself in my professional career. When I started out, some farmers told me to get off their farm, but I went back, had kitchen meetings and coffee with them, until they decided to make the change, to buy into the concept. We need to have long-term, sustainable development strategies if we are to give a sense of direction. We need to define what the role of the stakeholders is.
With respect to partnership building, from the conservation centre's perspective, we believe strongly in an industry- driven, voluntary and participatory approach. Environmental farm planning is one of such awareness tools. With reference to organizational support, perhaps we need to help the farmers through some mechanism, either through conservation clubs or councils, or agri-environmental councils, in order for them to get organized, because they are not now organized to deal effectively with the new environmental challenges. We must get the farmers to take charge in this respect. That is the point of this best management practice video here about climate change, which was produced by the Soil Conservation Council of Canada. It is basically about soil and water conservation. We need to redefine that in the context of climate change and adaptation. Let us not reinvent the wheel, because then farmers would be totally lost. I know all about that through my personal experience.
We need good management tools; a toolbox. Environmental farm planning is one such tool, but it will not do it all. It is an awareness tool. It was designed for that here in the east, pretty well. We will need a soil and water conservation plan for those potato growers there. We need technical support, engineering support to make sure that structures are implemented properly; that they will be implemented and will stay there as a well-maintained permanent structure.
We need to promote best management practices. We are talking here about nutrient management. However, nutrient management will not do everything if there is an erosion problem. If a farmer has a slope, a hill, even if he undertakes the best management, nutrient management plan, where does it say that that will stay on the land? It might all wash away. Thus, there has to be a follow-up record system, and farmers must buy into that. Greenhouse gas will also be part of this management strategy, as well as integrated pest management and on-farm food safety.
In terms of the national environmental farm plan workshop, we conducted that workshop because we were promoting and helping to adapt a process for the Atlantic region through the Atlantic Farmers Council when we noticed that some farmers in some provinces were ahead, and some others had difficulties. Thus we brought everybody to the table last March. We have proceedings available in both French and English. I left a copy for your committee to look at. It is also available on our web page.
What we found from this process during that two days is that farmers are saying that we need additional educational and awareness programs. We need to have a mechanism whereby farmers and producers are involved in the input to set research priorities so that when those BMPs are developed, they make sense to the producer and are effective. There is also a cost-benefit ratio. We need a voluntary process.
If we define those BMPs in terms of language, we need to have best management practices that will meet all of those category of the act and the policy framework. We can have the best management practice for water quality, but it may not be suitable for soil or air, so we need to look at BMPs that really work. That is quite a challenge to agriculture.
Why did I include food safety? We are the ones who are producing the food. Fruits come from a tree, but potatoes come from the soil. How healthy the soil is will determine the quality of the crop we will get from it. That is the potato quality, and that is what my brother will deliver to the McCain plants. That is what counts. It is not only the quantity; it is the quality, plus what he will make from his bonus.
With respect to best management practices — or BMPs — the conservation centre has provided a definition of that term, and I think it is important:
Best Management Practices integrate principles of production that enhance the long term economic and environmental sustainability of agriculture.
That is our centre's definition, and we want to stress here that such practice has to be also economically sustainable.
The Chairman: Is this shot the same farm that you showed earlier?
Mr. Daigle: Yes.
The Chairman: But it has changed?
Mr. Daigle: Yes. This is also a benchmark site of Agriculture Canada. After 10 years of preliminary research results, we have finally demonstrated that terracing systems and grass waterways are effective processes with which to control runoff and to catch more rainfall compared to another benchmark site farmed uphill and downhill. In other words, keep the soil moisture; capture and reduce potential flood damage down below. We need to have more of such practices. We have a paper that has been published on that subject with Agriculture Canada people from Fredericton. I think that we are probably the first in Canada to have this type of erosion control study, and we use one of our best conservation cooperators — farmers — that we have in Drummond.
Turning now to research and development — and I am trying to wrap up here because I think I am pretty well on my time. However, I want to say a few things because I notice that your group has particular questions about that area, and I would like to speak from the centre's perspective. We are a non-government body, so I feel that we have something to express to your group: that we need industry input to establish those R&Ds. The industry needs to be at the table. We need to find a mechanism so that they can buy in and support the research more actively.
I often go across the border into Maine and I look at the University of Maine cooperative extension service. They report every year to the farms and they are thanked for their support. Do you think we are going in the right direction? Are we doing that in Canada? I do not know.
We need to determine the economic benefits of BMPs. The farmer needs to know whether he will be spending his own money, his own resources, to develop best management practices — but for whose benefit? Long term research in such areas as soil conservation, climate change and water quality of less than three years is almost nonsense. We need at least five years, and perhaps ten years. If we are to seriously consider Kyoto and carbon sequestration, we need to start looking at research of perhaps ten years, plus, to really make some sense, because discerning climate change with variability out of three years research could mean, perhaps, that you have two years of drought and one year of rainfall in a maritime climate. The farmers always ask the question: What good is it? When was the research done and what was the climate like? Was it in the wet year or the rainy year? We are in the Maritimes here with a lot of climate variability; we are not in Saskatchewan.
Technology transfer has to happen. We need to have access to the R&D results. If we are to have decision-making tools for addressing a policy decision, we need some form of access to this information as it evolves; not to have to wait until it is published, which is perhaps five years down the road.
The centre's position on the drought issue is that we will probably have to face supplemental irrigation requirements in Eastern Canada. We will need to look at this because some crops will require water. We have to look beyond the existing safety net programs. What we hear and what we read in the papers is ``How can farmers get by with the next crop and meet the banker's bills?'', which is common sense, but we have to start looking down the road at the bigger picture. If a province has a loss of $10 million, could we at least invest $1 million in irrigation infrastructure for water sourcing development?
With respect to the incentive program for water sourcing and infrastructure, I am an engineer, so I have already faced that problem in my career. We need action. We cannot depend on withdrawing water from the river or the brook, or we will create conflicts with other water users. Irrigation should not replace basic soil-water management practices. I think that was mentioned yesterday several times in the discussions.
There is a need to promote best management practices and effective irrigation technologies. That could be efficient if we are to sell it on an environmental level.
We should conduct feasibility studies on supplemental irrigation so that we can prove to the farmers that it is going to pay. My experience in New Brunswick is that some guys change their mind. They say, ``Oh, no, I am going to change my rotation system. I am not going to invest in pumps and equipment. I am going to do something different.''
We need a better coordination mechanism. The centre has a vision about the future of agriculture. We are a very small centre for Eastern Canada, and we are trying to help organizations in the promotion of agricultural sustainability. We are facing major challenges financially with the centre's endowment fund, but we think that growth will be through leadership. We think that we can provide this leadership here in the East, at least in the Atlantic region, through better partnership-building with existing organizations and with proper resources. This could happen at all levels across Canada.
Public and producer education must be done. Someone has to do it. There must be more focus on rural community sustainability. We come from a rural community in Saint-André and we know the challenge over the well-head designation, the erosion, and amount of nitrate in the wells. The on-farm technology transfer is going to be part of the solution. If we cannot get access to this research data, maybe we need to conduct applied research to redesign it in a way that makes economic sense so the farmer can better understand the need for conservation. I come from a farm community background and was sometimes lacking arguments or practical research results to convince producers to act in implementing conservation programs.
The climate change initiative is a new opportunity, and our centre should be part of the centres of expertise and have proper funding.
Whole farm environmental planning is part of the agricultural policy framework. I started working in Drummond back in the seventies. I worked for over 27 years to convince growers to adopt the soil and water conservation systems that you have seen, that BMP research site.
We have the best cooperators and perhaps the best showcase in Eastern Canada and probably in Canada. The Chinese and other delegations from other countries are coming to see our positive experiences in technology transfer and adaptation, and they are saying, ``How have you done that?''
At the centre, we think that soil and water conservation should be an essential component of any agricultural policy framework development to ensure agricultural and environmental sustainability. It is hard to meet both demands. Again, if we want to meet the requirement of a healthy food supply and also a competitive environment, we know that farmers have to compete.
The Chairman: They will be your best salespeople.
On an earlier visit this week, an older gentleman said that if we start pumping the water out from under Prince Edward Island, the salt water will come in and we will to have an awful problem. What do you say about that? Is that a challenge, or how would you know?
Mr. Daigle: As a soil conservation engineer, I deal with geologists. I cannot speak for P.E.I., but it is certainly an issue that needs to be addressed. We need to be careful here in terms of how much water we can withdraw. There is a need for studies to document — and I think this is where we are lacking — the capacity of our groundwater resources. Through a study conducted by Jacques Whitford Environment Limited in the early nineties, we know about the Upper Saint John River Valley in New Brunswick. I was on the study's steering committee discussing what direction or options we would take. We found that over there the groundwater resource was not really accessible in the study area, except if you were close to a river or a real strong aquifer. If you were close to that aquifer, most likely a town or a municipality would be located right there. In other words, there would be competition for the resource eventually.
I think that there has to be a common sense approach. P.E.I. is probably the only province right now that has an agricultural policy to deal with irrigation. It does deal with surface water and also groundwater, but the groundwater part must be refined or revisited by way of a feasibility analysis, more testing and more integrated water resource planning.
The Chairman: In Arizona the water level has gone down 40 feet through irrigation practices.
Mr. Daigle: If I could make another comment, in the Maritimes, we have lots of runoff from snow melt. We need erosion and sediment control ponds to capture this runoff to make sure our streams are cleaner, which is a win-win situation.
Senator Wiebe: Usually with most presentations there are things that I agree with and things that I disagree with, but I must say that I agree with your presentation 100 per cent. I had an opportunity to have a good visit with you during our visit last night. I promised you that I would not ask you a tough question today, but I have changed my mind. I am going to ask you a tough question.
Mr. Daigle: It doesn't matter.
Senator Wiebe: We talk about the pressures that our farmers have from bankers and the global markets. Governments, both provincial and federal, are telling our farmers to diversify their operations, to get into mixed farming and into cattle, or to do this and do that. The farmers are doing it, but they are doing it strictly from an economic basis, not from an environmental basis because they have been pressured into it. How do we convince our producers or what should we provide to them to manage the environment and the soil correctly?
This is nothing new. Let's go back to the situation in Saskatchewan right now with the drought. Alberta has had it now for two years and last year was our first year of drought. We are going to be in our second year this year. Already we are trucking hay back and forth across our provinces to feed cattle, but that knowledge was there years ago.
When I was quite young, my grandfather said, ``Look, we are farming in the Palliser Triangle.'' For those of you who do not know the Palliser Triangle, it is a desert area from Winnipeg to Calgary to Saskatoon. He said, ``If you are going to farm cattle in this area, you have to ensure two things. One, have a deep well; two, have a three-years' supply of grass on hand or feed on hand.''
A number of ranchers in that part of Canada followed that advice, and they are sitting there quite comfortably. They are not putting a demand on government for feed assistance or freight assistance. They are not having to sell their cattle in a fire sale. The cattle are not chewing the grass down to where there is no protection against erosion; however, if we have one more dry year, the soil erosion on our grasslands will be horrific.
How do we transfer the knowledge surrounding new technology to farmers and ranchers who have worked that soil and who have these pressures on them?
Mr. Daigle: It is a complex question. I come from a farm background and have dealt with farmers who have lost their shirt, cousins of mine whose dad did not want to do the conservation in time. He waited too long. When they took over the farm, they lost it because the banker told them that they needed to be more intensive. Not only do we need to educate farmers, but we need to educate our bankers and our financial institutions. We have got to look at the whole picture. That is why I am saying that we need a framework to set the stage so that our bankers and financial institutions understand the issues of erosion and soil degradation. We are eroding this land, as Senator Sparrow said. I mean, it is kind of like going back to 1985. We need to start selling and talking and holding more conferences and having more field days and doing promotion with the public because the public does not understand.
We do not have the research to demonstrate to the farmers what it takes to make a transition as it relates to someone who has had erosion for 20 years. If a farmer has had erosion on his farm for 20 years at 15 or 20 tonnes per acre, what is left? It may take 10 years, 15 years, another generation maybe to rebuild the soil.
My brother is now seeing a return on what my dad did on the farm. He has been one of the McCain's top 10 farmers. He is very small but efficient in terms of better management practices and better rotation.
I think we need to look at competitiveness, but we need technology, transfer and adaptation. We need to provide the real answers because we cannot tell the farmers that they have got to do this.
Senator Oliver: What did your brother do to preserve the soil and the water?
Mr. Daigle: My dad did the work when I was still at university. He did it through terracing because we were farming soils on 5 per cent to 15 per cent slopes up and down the hills. Every year, with every storm, we had severe erosion down into the gullies. Just to tell you how severe the erosion could be, some falls I could hide between the potato rows in some locations on the farm. That type of erosion has not been as severe in P.E.I. because the slopes are not as steep and as long as in New Brunswick.
Again, we have to change practices. We are faced with change of ownership and we need to consolidate land. We need to remove fence lines to change the practice.
We have to get farmers to agree on the water outlet. When I talk about common infrastructure, sometimes we need a right-of-way to bring water to a safe outlet. It is complicated, but I would say that the benefit of what my dad did is now being seen by the next generation.
However, if we expect the farmers to pay the full cost, can this be shared? I said that $40 million a year was an on- farm cost. That is fertilizer application. As well, we have to look at off-farm costs from sediment, pesticides and all the other things that might get into streams. If we put a value on that, then society would know how much to invest in programs.
Senator Hubley: First, I am going to ask you first about crop rotation only because you have a 2.2-year crop rotation. Prince Edward Island is looking to legislate a 3-year crop rotation. Perhaps you could comment on the importance of crop rotation.
Second, I would like your opinion on how legislation could be accepted under environmental improvements, if that is going to make it any easier for farmers to accept.
Mr. Daigle: I know that P.E.I. has taken that approach. It would be very difficult to bring in a three-year rotation around Grand Falls, for example. I think that this legislation probably will have to consider alternatives because there are all kinds of rotations that will build back the organic matter depending on the cover and the conservation cropping and management. I think that tools must be developed to judge rotation versus another option. Looking at the universal soil loss equation, or the USLE, there is a tool called the C-factor that the U.S. has years and years of experience with. The C-factor is a way to judge a rotation versus another rotation system. It is called the cropping conservation method. As well, a terracing or strip cropping is part of the equation, the P-factor. The C-factor and the P-factor in the equation amount to the control measure that the farmer has available. The C-factor is how we judge a rotation.
I think there are some efforts in P.E.I. right now to judge an equivalent rotation to a three-year rotation because no one can afford the transition unless there is some kind of judgment. There has to be some clear understanding about how we are going to go at this issue. It will be a challenge to convince producers to move because the benefits do not occur right away. In Grand Falls, we have seen that in moving from a conventional rotation of one year or two years of potatoes to one year of grain to a rotation of one in three, it could take over three years to make a transition. We will see a difference not only in the quantity but in the quality of the product because that is what the customer wants in McCain's fries. I know there has been quite a debate in P.E.I.
Senator Oliver: My question will be short because the Chairman has asked the question that I was going to ask about groundwater.
I have sisters who live in Bermuda where they catch rainwater and use it for flushing toilets, for showering, and so on. They have a system of cisterns. The rain hits the roof and goes into a huge holding tank in the basements of the houses. That is their source of water, and it seems to work.
How can we more fully utilize rainwater on our farms? Would you suggest we use cisterns? In places like P.E.I., which are surrounded by saltwater, are desalination plants a way of converting saltwater to freshwater that can be used on farms? How far have you gone in that research?
Mr. Daigle: Our centre does not do research. Our function is to review the literature. We know that the available information respecting groundwater resources is quite limited. One of the experts in the region of Nova Scotia is Terry Hennigar.
Senator Oliver: Terry, I believe, will be appearing before us tomorrow.
Mr. Daigle: I have heard part of his presentation about what is going on in the Valley. They have some preliminary results, but they still lack data for our groundwater system. We need investment to develop the scientific answers. As an engineer, I know that there is always an answer, but there is a cost attached to that. However, we have to find those answers.
The first thing we have to look into is water allocation. In 1995, I was part of a team in New Brunswick that considered the consultation process involved in that. We were encouraging surface storage and bypass ponds. However, it is a case-by-case situation. Much depends on the farm soils, the geography, the topography, and the geology of the soil, but I would say that trying to capture water from the spring runoff may be the most sustainable way because of our maritime climate conditions.
Farmers in Grand Falls have developed a system which pumps water from the river. They are already capturing enough from natural runoff for two or three irrigations up the hill, but they pump to fill in. I would say the same situation would apply to groundwater. We need to come up with a system with a lower rate of pumping. Irrigation requires a higher rate, a higher capacity, so we need a system where we have a combined storage reservoir that is well sealed with a lower pumping rate and still capture as much surface runoff as possible. That would be my approach from an engineering standpoint.
Senator Tunney: I do not believe you addressed soil management, that is, structuring the soil in such a way that it will capture rainfall instead of it running off. I am talking about two things. One is crop rotation where we would sow grass or alfalfa, which is deep rooted and prevents erosion, and the other is soil penetration. As you know, with minimum tillage, the water has to run off because it cannot penetrate the soil. It may be hardpan as a result of heavy machinery causing soil packing. There may be a lack of humus in the soil that would maintain good soil structure.
For example, I have heavy clay on my farm and the ground is virtually as flat as this floor. In any year when I do not chisel plough, when I do not penetrate that soil, and we have a dry spell, my corn will show wilt. However, if I have chiselled the soil, opened up the hardpan, I never ever see wilt, even if we have a severe dry spell.
Mr. Daigle: I did not comment on that because I was trying to deal with the more global point. I did not get into details. There are all kinds of ways to deal with that situation. An engineer with P.E.I. Agriculture, Mr. Ron DeHaan, has looked at residue management, mulching, and doing conservation tillage. No tilling potatoes is quite a challenge, and probably not a realistic alternative yet, economically. However, I agree that we have to consider compaction because the heavy equipment we use, such as harvesters, means that we put several tonnes on an area of about a foot and a half square. That creates a vacuum system like a vibrator or a compactor. Yes, we do have a compaction problem.
We need to look at tillage practices. We should consider systems which involve cover crops which will leave residue. We also have to look at better rotation systems. There is range of choice, and it is always the farmer who makes the decision. We need input from people who are well trained in this area. We lack trained people in Eastern Canada. They come out of university — and I am one of them — and they have to learn in the field. This is not something that can be learned from reading books. It is not being taught in colleges.
The Chairman: On that point, in the Prairies this happens by nature. We get such dry weather that you could drop a crescent wrench down the cracks in our land, they are that wide. When it rains the water runs right down into the cracks. As well, in wet years, the frost will go down six feet and break open the soil. Then the water runs into those cracks.
I only know of one small area where they have used deep penetration behind, say, a Caterpillar that digs down about three feet and breaks up the hardpan. Usually that is not a problem for us because of our climate. Since we only get about 12 inches of rain in an average year, it is quite a different thing.
Mr. Daigle: Sometimes we get that much in a storm in 24hours.
The Chairman: Yes.
Senator Day: Thank you for showing the photographs of the beautiful Saint John River Valley area. I hope my colleagues will visit that area one of these days. We started in Fredericton and travelled south, which is also very beautiful.
Yesterday, we heard from Mr. Soucy, who is from the Edmundston area where that terrible car accident occurred. Undoubtedly you would endorse, as I did, the transportation issue.
With respect to your photographs, it would have been nice if you could have put them beside one another, one showing the situation before terracing, and one showing the situation after terracing.
Mr. Daigle: I was going to do that, but I avoided it for this round.
Senator Day: I think that could be very powerful.
Mr. Daigle: I did that when I met with Senator Sparrow in 1995 at the conference in Grand Falls. Three lines of media were present, French, English and one American station were there. I did show the before and the after. However, we need time to set up for that and we need two projection systems.
Senator Day: Following up on Senator Oliver's question, in relation to capturing surface water, could you send us a real-life example of how it was done? Are the ponds that we see on many farms these days a part of that?
Mr. Daigle: I have some examples right on my computer that I used in another presentation I did two years ago.
Senator Day: It would be helpful for us to see those.
My final question again arises from the photographs and the fact that your brother succeeded your father. We know that McCain's has two huge plants in that area. Has there been a history of major companies buying the farmland in that area? Is the succession still happening? Are there still many family farms in the area?
Mr. Daigle: About 20 years ago there were some efforts by McCain's to buy some land. I do not know of any new purchases in the last 10 years, so that has changed. McCain's changed its rotation pattern in at least the Grand Falls region. I have not seen a major increase in holdings by large companies. I do know, however, that we have fewer farmers and the farms are getting bigger. My brother has stayed small. He just could not expand in Drummond unless the access was available on Irving's land which is good Class 2 land. There is also some Crown land there that could be accessed as well.
There must be a multitude of approaches. In any policy framework, we need different, customized approaches, because each region is different. Each potato production or cropping system is different. Having worked for 15 years in the field, I had to adjust my thinking and my formulas to understand the realities that the farmer has to deal with. He has to buy in. These are not my terraces or my waterways. They are his to maintain. He has to understand that he is the owner, I am not.
Senator Wiebe: You partially answered my question when you responded to Senator Tunney. We have a lot of work ahead of us to educate educating the extension people. I think that some of them may not want to accept new ideas because it was not their idea that was put forward.
On behalf of the committee, I sincerely want to thank you for your excellent presentation today. I have your card with your telephone number, and I hope you do not mind if I use it occasionally.
Mr. Daigle: That is what the centre is there for.
In closing, I should like to say that I see climate change as an opportunity for us. If we are going to talk about soil sinks and sequestration, we must come back to talking about basic soil and water conservation. We have been trying to preach good conservation, but we have not always been successful.
We look forward to your report. I remember Senator Sparrow's report raised the expectations of producers. We invited him back after the report was presented, and the crowd was so large that there were not enough seats in the room in Grand Falls. People had to stand up. The media was lining up for interviews. That report had an impact. I just want you to keep that in mind.
Senator Wiebe: I think that your suggestion about climate change, global warming and our future security is an excellent one. I hope our committee members will consider that as the next project for our committee.
The Chairman: We will convey those compliments to Senator Sparrow.
The Chairman: We would like to welcome to our committee the New Brunswick Federation of Agriculture. Mr. Paul Vautour is the Executive Director. We will proceed to questions after your presentation.
Mr. Paul Vautour, Executive Director, New Brunswick Federation of Agriculture: Thank you for the invitation to present this brief today. As New Brunswick's largest general farm organization, we are proud to advocate on behalf of our diverse industry, drawing on the broad perspectives of our members in all commodities, of many different types of farm structures and sizes and, of course, we are pleased to serve our members in both official languages.
From a national perspective, it is perhaps tempting to consider New Brunswick a small portion of the Canadian agriculture picture. However, from the point of view of our own population and provincial economy, agriculture is a major player. Our agri-food industry rests on a base of more than $300 million of farm gate receipts per year, and produces $1.4 billion through value added processing. About a third of our primary industry employment is on farms, and a further 5,000 New Brunswickers work in food processing. In a jurisdiction of only 0.75 million population, agriculture is of much greater significance than generally perceived. Moreover, New Brunswick agriculture has not yet achieved its potential. We in the industry know that the potential for increased production, diversification, and valued- added activities exist. We are determined to develop our industry in a socially and environmentally responsible manner. To this end, we advocate a well-developed plan that includes strategic investments, good communication and a balanced approach to responsible development. As industry representatives, we look forward to working with our government partners to this end.
I will now turn to how we see the role of the federal government in Canadian agriculture. Although agriculture is a shared federal and provincial responsibility, we look to Ottawa to ensure equity, express national perspective, represent us internationally, and perform key regulatory and monitoring functions which are in the best interests of the population and the agriculture industry.
We also require federal leadership to ensure our sector of adequate stability through time. Modern farming standards mean that necessary levels of investment are high, and some assurance of consistent or predictable developmental and regulatory policies is required in order to make a good business case. Like available natural resources and other inputs to a viable farm operation, these functions are very much part of the context of our industry and, as such, are a major aspect of our interaction with government.
I will now give our view of the Whitehorse accord and the agricultural policy review. The five priorities identified under the Whitehorse accord fit well with the New Brunswick Federation of Agriculture's approach to development of our industry to provide a suitable format for our general discussion. We can begin by raising a few key points under each of these headings.
Our industry is science based. An effective research strategy must incorporate issues of equity and timeliness, as well as a relevance to all the jurisdictions involved. Here again, we can see the balanced role of the federal government is a major factor in delivering a strategy which provides the greater good. There is a role, as well, for industry funded research, but clearly this would be focused on a different type of goal than publicly funded, publicly available research.
The need for a public research strategy is pressing. Some challenges include the possibility of climate change and its impact on resource availability, changing pest and disease patterns and cultivar research. New opportunities need to be explored, and such areas as biofuels, nutraceuticals and pharmaceuticals could be extremely rewarding avenues of research.
The concept of a New Brunswick Agricultural Research Foundation has appeal. A mandate could be to guide and support agricultural research relevant to our industry. Farm and processing groups could be represented on the board of directors. Such a government-supported organization would be a cost-effective way to generate direct input from the people who actually use the research results.
Key to the success of any research strategy will be the communication of results and access by industry to a range of data used to generate them.
The goal of a risk management strategy should be the long-term health, sustainability and stability of our industry. Note that we have used the term ``risk management'' rather than ``safety nets.'' That is to emphasize the need for a broader risk management strategy. One aspect of this thinking is found in the concept of finer and more intensive management of all aspects of farming as an essential competitive edge. Safety net or cash flow stability programs are a component. In this regard, many producers have asked for a ``whole farm approach'' to various programs.
A comprehensive risk-management program should provide the tools to reduce the need for government intervention on an ad hoc basis.
On the subject of food safety, the importance of arm's length food inspection and product regulation cannot be overstated. It is a key component of the overall image of Canadian agriculture as a safe and reliable enterprise. It is a pillar of public confidence and support for our industry.
The continuing government funding and support is, to some extent, dependent on public support, at least in the political sense. This is a good reason to place emphasis on a comprehensive campaign of public education on the food safety system that they enjoy. Further, any international trade advantages offered by our inspection and regulatory systems should be well understood and maximized. This is one area where the economic benefits of our approach can be made tangible in the eyes of the voting public. On a related issue, farmers and knowledgeable consumers often remark that imports should naturally be held to the same safety standards as our own products.
Modern food safety tools such as hazard analysis, critical control points, ISO standards and so on are an emerging area of farming development. Enhancements of on-farm management techniques which are aimed at increasing the levels of documentation, data handling and analysis, are good areas for public funding. Society as a whole benefits, and the human resource development is long term.
Addressing environmental issues is a significant aspect of farming today. We recognize that the level of public interest has increased, and the patterns of land use near our farms have changed as well. Many of the activities farmers will be undertaking in the environmental arena are for the ultimate benefit of society at large and some, in fact, are due to the encroachment of non-farming activities. Adjustments are needed as the context of our farms change. Under these circumstances, it is appropriate in some cases for government programs to support the farmer and assist with certain types of environmental developments. Financial incentives could include tax credits for certain activities.
In regards to CO2 and methane emissions, the role of farmland should be better understood and communicated. Tax credits again are a possibility, as not only is this a general environmental benefit, but also producers are directly involved in better positioning Canada as a whole in international trade matters.
A great deal of work has already been devoted to environment issues in farming, and, again, society at large has benefited. We have much to be proud of and we are in the uppermost tier of environmental practices worldwide. This should be part of the message when government tells the story of Canadian agriculture.
The concept of the multi-functionality of farming, and its benefits to society, is well recognized in Europe. In this paradigm, the farm is seen not as a food production facility, but as a tourism and recreation resource, a wildlife habitat, an ozone sink and a oxygen production plant. This is another component of the message we must promote in order for society to recognize our true value.
On the subject of renewal, the meaning of ``renewal,'' in the New Brunswick context may be different from the meaning it is given in some other jurisdictions. As mentioned earlier, we are in a position to expand and diversify our industry. We are looking for innovations, production, processing and marketing development to foster this development. When we think of renewal, we think of the next generation of farmers and ask about their education and their skills. We think about the availability of the land and the water resources farming needs. We are also interested in our place within the rural landscape, rural communities and governance.
Renewal also means a rethinking of our habitual ways of doing and thinking. We should seek out and maximize advantages we may have missed or been distracted from by politics or history. For instance, we may have been neglecting the opportunities presented by the New England market. Are there others that we missed?
In addition to the five headings under the policy renewal framework, there are two other areas the New Brunswick Federation of Agriculture would like to comment on at this time.
I will start with the federal-provincial-territorial funding agreements. The discussion of funding allotment formulas is a constant in Canadian political discourse and we are compelled to raise the issue again. In terms of agricultural development funding, programs should factor in potential and opportunity rather than, for instance, size, population and historical cash receipts. Basing the New Brunswick development philosophy on the past rather than on the future will mean missed opportunities. We would be prepared to discuss this matter at some length as part of our current policy review.
As far as the design of specific programs and the administration of them goes, the ideal would be an equitable framework, with some internal flexibility built in, to allow jurisdictions to tailor specific aspects to meet their real needs.
We also need information about other programs, which may not be specifically agricultural but address some needs of ours, such as small business management, innovation, information technology, and so on. Agriculture Canada could research, communicate and maintain an advisor in this area at very little cost.
As to public perception and agriculture, the role of government in explaining the food system and its place in Canadian life may turn out to be pivotal. Communication with the public has been mentioned several times during this presentation. We feel that a better program of explaining the nature of our industry, how it benefits the average citizen, and how it affects our future would be of great assistance to us. We are finding an increasing level of misunderstanding among the public, and perhaps even more threatening, a distinct air of complacency and apathy about the Canadian food production system. If we are to achieve our potential, we must have the support of the public, the politicians, our industry partners, and the administrative branches of government. We have to let them know why this is important, why it is deserved and why it is a wise investment.
Thank you very much for the opportunity to present our thoughts here today. We would be happy to follow up on any of these issues in greater detail at any time.
On a personal note, I would mention that Bruce Oliver is our policy analyst and his number is on the bottom of the page 1. I sat with the board of directors last week when we formulated this brief, and I am just a small producer. My commodity group is very small.
For emphasis, I would draw your attention again to the second paragraph of this presentation which states, ``From a national perspective, it is perhaps tempting to consider New Brunswick a small portion of the Canadian agriculture picture.'' As my duties as a director of the New Brunswick federation, I often meet with large commodity group representatives who come in and they usually have the bragging rights about the size of their contribution to the provincial economy. I always remind them that I come from a very small sector, apiculture, beekeeping, which is a small but important part of agriculture. At our general meetings I have told them a tale I learned in school in Grade 3. We learned a song to the effect that a human being was travelling through a strange land and he came across a group of pygmies and he was taunting one of them, and the punch line was, ``I am quite as big for me, said he, as you are big for you.''
The Chairman: In your excellent presentation you talked about the importance of the public understanding where agriculture is at, and there seems to be a major vacuum between how we do that in Canada or are not doing it, and how the Americans are doing it. Americans are very aware of the heartland. They are very aware of agriculture. The public in the U.S. supports agriculture all the way, which allows their governments to move. How can we get that to happen in Canada?
Mr. Vautour: You are absolutely correct on that. The chairperson of our agricultural awareness committees is Ms Karen Davidge. The committee has great plans. We also had great plans the year before but, because of the hoof-and- mouth disease scare, we could go ahead with them. The year before we had an open farm day on the farms across New Brunswick and we had a tremendous turnout. There was great public support.
The Chairman: It may well be that farmers and farm groups have to accept some of the blame for the lack of awareness. When I chaired the task force on drought for Western Canada, reporters from The Toronto Star asked how they could help. Perhaps we are not taking advantage of some of the press opportunities to communicate.
Mr. Vautour: I think you are absolutely correct, and we are working on that. I also serve as chairman of the New Brunswick Agricultural Council which administers the CARD fund. Karen has started a project for the agricultural awareness drive but things are not moving quite fast enough for her. In fact, she tackled me when I came out of the board of directors meeting last week. They are working hard on it.
Senator Wiebe: This summer I had the opportunity to spend some time in Newfoundland. I found that the federal Department of Agriculture, through their research station, was spending a large sum of money trying to develop a way to grow barley in Newfoundland. They want the barley to feed their milk cows. Our provincial government has spent a lot of money on researching how to grow potatoes in Saskatchewan. In your mind, is it wise to spend dollars so that one provincial farmer can get the knowledge to compete against another provincial farmer? Prince Edward Island does a tremendous job of growing potatoes. If we grow potatoes in Saskatchewan, will we take away some of Prince Edward Island's market?
You mentioned the need for a certain kind of research. Is this something that government should continue to do?
Mr. Vautour: Our organization is currently undergoing a restructuring. I have had the privilege of being in there from the start, sitting on the board of directors and meeting with all the diverse commodity groups in New Brunswick. That topic has often been raised. We would hate to see diversification in our domains, but we do have free trade. It is shocking to hear that the federal government would be supporting potato production to the extent that it might kill potato production in New Brunswick. You can only eat so many potatoes in this world, and we are doing quite well at producing those now.
I am a volunteer. I represent a small commodity group on the board of directors of the New Brunswick Federation of Agriculture. We usually meet as a group. There are 12 of us on the Board of Directors, and we discuss all these things. I know beekeeping intimately, but when I am with some of the other commodity groups, I know I am in a learning curve. In our deliberations with commodity groups, they have expressed concern that diversification in other areas might be infringing on their production.
Senator Wiebe: I certainly would not apologize for being a small producer because we do contribute. We hear far too much from the big lobby groups and not enough from the small producer. I think if we listened more to the ideas of the small producer, we may have a better feel for what agriculture is really doing in this country.
Mr. Vautour: Our organization is changing dramatically. We have to keep up with the times. Lots of people want to get their two cents worth in. Only farmers could belong to our organization, but we have amended that to allow representative of the various commodity groups to be members of our board of directors. Our board of directors, we expect, will expand from 12members to 40 or 45, but everybody will be heard, not necessarily just the commodity groups.
The women of New Brunswick organized a group for the friends of farmers, people who are allied to farming. They also will be allowed to have a representative on our board of directors. We are allowing everybody we can in, and we hope to come up with even better ideas for the future. We are trying to be self-sustaining.
Senator Oliver: My first question relates to bees. We have heard a fair amount of evidence in the last three days about the blueberry industry in Nova Scotia and New Brunswick and of its success story with Oxford Frozen Foods. Do you raise bees for the blueberry industry?
Mr. Vautour: I am glad you asked this question. Now I can speak knowledgeably. I just returned from a national conference. I wear many hats. I am the Maritime delegate to the Canadian Honey Council. I am also a member of the Canadian Association of Professional Apiculturists, which recently met in Banff. I am also the chief bee inspector of the Province of New Brunswick. I am a small, commercial beekeeper and I am having terrible difficulty expanding. The lending institutions do not consider beehives, et cetera, to be a commodity or an asset. They say it is too risky to lend us money. If I were a cattle rancher who started getting into trouble, they would just take my cattle to a slaughterhouse and get their money. They do not want to know anything about bees.
We do wild blueberry pollination. Our industry is in a bit of trouble right now, and we are trying to get out of it. We will be meeting with our minister next Tuesday. We have some real issues to discuss with him. We also have some solutions to suggest, solutions that will not cost a lot of money, we are proud to say.
Our bees have a pest called the varroa mite, varroa destructor, a tiny parasite that gets on the bee and the larvae and causes them to become sick. Eventually the hive actually collapses. Over the years we have treated it successfully, but last fall we found that there is a resistance to the medication we use to kill this mite. The mite is tiny but, to a bee, it is the size of the dinner plate. We think we will get an emergency approval through the pest management regulatory agency for a new product that they use in the States. It is a one-shot deal that kills this mite off. Then we can move on to some integrated pest management.
We lost 60 per cent of our bees last spring. The blueberry growers were clamouring to get bees. I cannot remember the value of wild blueberries offhand, but I think for every dollar invested in bees by a blueberry grower, they get $240 back in increased productivity. It is big. Like I say, my commodity is very small, but it has a big impact.
Unfortunately with our farming practices these days, when a clover field comes into blossom, it is cut, and that is when the bees are there. We are getting hit by double whammies all over the place. The bees are having trouble surviving all of this, but they are.
As to the blueberry fields themselves, when they clear all that land, they ruin the habitat for wild pollinators, so they must have these managed pollinators, bees, to compensate for the wild pollination that does not happen. For every hive you bring into every acre of blueberry fields, you will increase production by a thousand pounds of blueberries. It is considerable.
The blueberry growers are worried as are we. We will try to solve the problem, though. Bees have been around for 12 million years.
Senator Oliver: After the snow melts in a blueberry patch, when do you take the beehive in and when do you take it out?
Mr. Vautour: Bees are very particular and they are loyal to one flower. Once they start foraging on a flower source, they will not change. If you go into an apple orchard, for example, and there are dandelions around and the bees go to the dandelions, they will not go to the apple blossoms. You have to mow the dandelions down before the bees will go to the apple blossoms and stay there.
Blueberries do not have a high nectar yield for the bees. They are not attractive to the bees. We have to wait until the blossom is about 25 per cent open in the fields, and about 25 per cent of them open, and then we move our bees in and they will automatically go to the blueberry blossoms. They will stay on the blueberry blossoms and they will pollinate nothing but blueberries. They will not switch to another blossom.
Another problem in fields, of course, is there are nice cherry trees all around the blueberry fields, and the bees prefer those.
Senator Day: Mr. Vautour, did you tell us where your farm is in New Brunswick?
Mr. Vautour: I am located slightly north of Moncton in a place called St. Phillip. I do not actually have a farm. I live there, but I do not keep bees on my property because the neighbours do not like them. A problem is the public perception of bees. Farmers in the area have allowed me to put my bees on their farms when I come back from the blueberry pollination. We cannot put any more than about 30 bees in one spot within two miles of each other because there is not enough forage for them, so we spread them out.
Senator Day: Senator Wiebe made the comment that P.E.I. does a good job of growing potatoes, and you pointed out that New Brunswick also does a good job of that.
Yesterday someone told us that they were bringing bees from Saskatchewan. I cannot remember the name. We had trouble in English and French with the term ``leafcutter.''
Mr. Vautour: That is the alfalfa leafcutter. Yes, those are a different kind of bee. They do work in blueberry fields but they have a slight problem in that they do not forage at low temperatures like honey bees will. In fact, bumblebees are the best pollinators but there are very few in the springtime. The alfalfa leafcutter is being introduced. They have different traits. I have not studied them in very much detail, but I understand that they only forage for about 300 feet from their nests. They don't go too far.
Senator Day: We visited the Fundy Model Forest in Sussex as part of this week's trip. That model forest focuses on farms, primarily small woodlot owners. You mentioned the concept of multi-functionality in your report. Of course that covers the various aspects of this other than harvesting for fibre. Now that is the same multi-functionality you are talking about on farms, and Fundy Model Forest is part of farms in the sense that the small woodlot owners are often mixed farmers. Is there anything specifically for farming in New Brunswick that is similar to the Fundy Model Forest?
Mr. Vautour: I do not know of anything offhand. We are trying to incorporate the small woodlot owners into our organization. That is another aspect of our evolution as a representative group.
Senator Day: It is a good plan to bring them in because they have already been educated on multi-functionality and its various uses through the Fundy Model Forest network. You may want to investigate that one.
Senator Hubley: I love bees. I think there is a great opportunity in our area for beekeepers.
You talked about making the public aware of the challenges that farmers face. Do you have any suggestions for us on that particular subject? Do you still hold fairs and exhibitions and run radio shows and write newsletters — the things that we traditionally remember?
Mr. Vautour: Yes, we do. We try to get in the media's face as much as we can. We never miss an opportunity to face the media and talk about our industry. I personally go down and tackle the newspapers, particularly the Moncton Times & Transcript. They did a full page on me and my beekeeping. I do go out to the fairs with my observation hive. They have an observation hive that I can use in Fredericton and I go to the various fairs around that area. I go to schools also with my observation hive. The school teachers tell their children that the queen is coming to visit, that they are going to have a royal visitor. This goes on for about a week until the day before. They are really hyped up.
I bring in some equipment, a smoker and a veil and that sort of thing, and I show them what beekeeping is about. Then I unveil the observation hive and they all draw back, but in about five minutes, they are all there poking at it and trying to take it apart and get the bees to come out and so on. It does change the perception of people if you go out there and do some public relations work. We are trying to do as much as we can. If you have any ideas for us, we would gladly hear them. If we have some ideas, Karen Davidge, who is our leader, will convey them to you.
Senator Hubley: Do you think the media, through television shows and so on, are doing enough on behalf of agriculture?
Mr. Vautour: Unfortunately, they will take the sensationalism route. If somebody in the United States were stung to death by bees, they would report that. Incidentally, bee-stinging deaths are probably only 1 per cent compared to lightning strikes. It is rare. It is totally out of character. Bees are not like that. I do demonstrations for growers and I go in without a veil on and with sleeves rolled up. It is nothing to take a hive apart and put it back together again. I show them that they should not be afraid. They usually ask how strong hives are and whether we are getting our money's worth.
Senator Hubley: The bee population went through a crisis. They were looking at one of the pesticides that was used on potatoes.
Mr. Vautour: Yes. That pesticide is called imidacloprid. It is used on potatoes as an interval or full-year spray. We just came back from a study that was done on it on Prince Edward Island and in New Brunswick by Dick Rogers and Dr. Jim Kempt from UPEI. They could find no evidence that bees could get at it, so we were relieved. We thought that was the source of the problem. It causes a nerve problem in the bees. If they get it in the pollen, in the honey, the plant absorbs it, bugs eat it and it disorients the bugs. It started in France. When they started using that product on sunflowers, people noticed that their bees were becoming disoriented and not finding their way back to the hive. We thought that was a problem that was restricted to Prince Edward Island and then we noticed it in New Brunswick. These were only observations, and they were not based on scientific data. The scientific data seems to indicate that is not the problem
The Chairman: My question should perhaps be more appropriately directed to the Federation of Agriculture since it is about safety nets, programs and so on. It is a difficult job for the federal government to find programs that work in all provinces. One province will go along and another will shut it down. Your general suggestion is that ad hoc solutions are not the best way to go.
Mr. Vautour: No, they are not.
The Chairman: However, in a country like Canada you have, for instance, a drought in southwestern Saskatchewan and in the eastern part of the province the crop is pretty average. How can the government deal with this if it does not deal with it in an ad hoc way? I realize the importance of national programs, crop insurance programs and so on, but they are very difficult to implement. They were even trying to do that in the days of John Wise days, which was 22 years ago, and they never succeeded.
Senator Wiebe is involved in a special task force with the Prime Minister and, I know he recognizes that it is a tough job because we are such a regionally diverse country. You have different problems in the east than we have. We were told that only 30 per cent of your farmers are in the crop insurance program.
Mr. Vautour: That is absolutely correct. Our organization has discussed that at length and with other commodity groups. If you think there is diversity across Canada, you should sit in at some of our meetings. The milk producers do not want to have anything to do with the way the potato people do things, and the potato people do not want to do anything with the egg producers.
The Chairman: You make the point. Our last presenter suggested that the United States divides areas, and then divides people into groups. There is no question that the American government supports its farmers.
It is a complex problem. Perhaps when you meet with your Federation of Agriculture brothers across the country you could pull something together and present it to governments. When I was part of the Mulroney government, we had as much of a problem with that then as we are having with it today. I do not think it can be done if your federation cannot bring it together somehow.
Mr. Vautour: That is why we are trying to regroup. We are trying to bring all the commodity groups together so we can hash it out and speak with one voice for the entire agriculture industry in this province.
We think that our members of Parliament are under a terrific amount of pressure from the public.
You are probably of the New Brunswick Metz farm, which is a hog farm. A protest group just moved in there. They are what my Newfoundland colleagues would probably call ``townies'' that is, people who move out to the country and don't like the smell of manure. These hog farmers are going overboard to protect the environment. There has been no environmental impact from that farm. Yet, this protest group is putting a lot of pressure on our government, our politicians. As well, they are funded publicly. It is not fair to the farmers.
Senator Tunney: We have federations of agriculture all across this country and then we have the CFA. Are you a member of CFA?
Mr. Vautour: We are a member of CFA. We will be meeting on March 3 in Halifax. We will be sending our whole delegation to that meeting.
Senator Tunney: The Minister of Agriculture, Lyle Vanclief, is talking about rolling all of our safety net programs into one. Are you aware of that?
Mr. Vautour: Yes, I did read that. I also hear Mr. Rock make an announcement to that effect. For the last two weeks my feet have not touched the ground. I was in Banff, Alberta, for a week and I have been to meetings all over the place. I just picked up this brief yesterday in Fredericton and I am here today. I have not had an opportunity to respond to the news lately.
Senator Tunney: One of the problems is what our Chairman has called ``regionality,'' different needs in different parts of the country. The Minister of Agriculture is talking about rolling all of safety net and emergency programs into one program. He is saying that a farmer will either be in or be out, and if he is out, there will be no compensation for him for any loss or price shortage, weather, devastation and such. I am not expecting an answer from you as much as I am trying to alert you to the situation. I think you need to monitor this and to talk with your confreres in other provinces.
Mr. Vautour: I will.
The Chairman: Thank you for a most interesting morning.
I would welcome our next presenter is Mr. Andrew McCurdy from the Soil and Crop Improvement Association of Nova Scotia.
Mr. Andrew McCurdy, President, Soil and Crop Improvement Association of Nova Scotia: I am pleased to be here and to have this opportunity to join in your discussions.
There is a lot of optimism as well as some pessimism about the present state of agriculture in Nova Scotia. We must focus on the optimism so we can strive forward to make the changes required to our farms and to our state of mind.
In recent years, weather has been a large factor which has affected farming. It has been variable from regional to region, and even within Nova Scotia. In 1997 the farm that I farm with my brother and father was very hard hit. The following summer our neighbours throughout province and in the other areas were equally hard hit. However, the Annapolis Valley has been the hardest hit in most consecutive years.
We have, as Nova Scotia farmers, access to a large acreage of beautiful farmland. Urban development has not pressured us to any large extent. It is a problem we do deal with from time to time, but it is not one that we deal with on a day-to-day basis. Our primary crop is forage crops which offers us some resilience in that they thrive in our Maritime climate. I believe that we grow the best forage crops in the world. I think that is a real credit to us.
You are interested in expansion and, having thought about it, I must wonder if markets are growing. Why are we expanding? Are we cannibalizing our neighbours' farms? My father and brother work a dairy farm. They farm a supply-managed commodity. I am a soil and crop farmer, but that is not our core business. Our dairy farm is our core business.
A while ago, farm management specialist asked me, ``If you are thinking of expanding, you have to ask yourself whether you are best at the size you are at now and consider why you want to expand.'' Nutrient management plans will throw a real wrinkle into that also. Do we have enough land units for the animal units we have in the province? Those are questions that need to be answered.
After saying all that, our farm is expanding. We expect to stay at slow and steady growth. I would suspect at the growth will come on the backs of our neighbours wherever they are. That is the reality of our culture of agriculture. Farms are getting bigger and the smaller ones are dropping off the scale.
Other issues that we must deal with in Nova Scotia are our shortage of capital and the fact of succession. The number of farms that have to be transferred from one generation to the next creates a daunting task. Our family is in the midst of it right now. There are skills required to do that job that do not come easy to people who are used to production, but those things need to be done. I don't know how I can explain it any better than that.
I will talk about dairy somewhat more than any other commodity because I am most familiar with that. Production efficiencies over time have allowed one unit of labour to produce more milk and to harvest more acres in one hour. That has driven agriculture output. Scientific improvements have increased our production capabilities, which means our average farms will produce more per unit of labour, per unit of land, and per cow. We should try to achieve slow steady growth, and we should work on that.
With this growth, is there enough income for succession to happen? Can the younger generation afford to buy the assets required to farm on an ongoing basis? In my opinion, the margin in dairy farming cannot sustain the assets, the operating expenses, and the living expenses for a family. The older generation, with their incremental expansions, as my father experienced over his lifetime, have set prices for quota and land in our area. Those are the real assets that we need to purchase.
Our corporate friends that produce our equipment such as Case, John Deere and Alpha, decided that they wanted a bigger slice of the dollar. That adds up after a while.
Our farms can be valued in many ways. Breakup value is very different from a going concern value. If you look at the succession model and at what Nova Scotia dairy quota is worth today and what it can finance, they are in completely different orders of magnitude. For succession to happen, and for the younger generation to be successful, normally the older generation gifts a large portion of the farm assets.
We have had programs in the province to assist new entrants. It is a step in the right direction, but in reality, we have to achieve far better margins for our farmers. Farmers have a hard time setting prices. We are in low margins. Our market is the consumer. We have few customers, and they are generally the Sobeys and the Hostesses of the world. Because of consolidation in the retail market, we have come down to the per-price takers, not the price setters, and there are some anomalies in that.
The farmers' market concept is a good one, but it means a limited expansion model because the farm market concept works on family relations. I will sell to you because I know you, but patrons of farm markets also need grocery stores. I see farm markets as a wonderful niche, but they are not a complete answer for sales of agricultural products.
The human resources in Nova Scotia are of the highest quality. The Nova Scotia agricultural professionals who service our primary producers are second to none. Our primary producers are well educated, knowledgeable, and good business people. However, there is a question about the quantity of qualified labour in our industry, and I believe that is related to our low margins. If we could afford to pay more to have the proper employee do the jobs for us, qualified help would quickly become available.
Our industry is also struggling with leadership within our farm organization. Our best farm leaders are home farming, and I cannot fault them for that because that is where they make the most money. However, as an industry, we will have to grapple with that in the coming years because our leadership needs the money and it needs the time to devote to our organization.
Our climatologists tell us that Nova Scotia has been in a drought for five consecutive years. At a regional meeting of our association yesterday, it was said that within 10 to 15 years, we would have 200 to 300 corn heat units in addition to what we have now. We will increase by that much and still have the same precipitation level in Nova Scotia. Climate change of that magnitude is daunting, scary. I question whether our farms can make the change. It may mean a whole shift in what sectors of agriculture will be viable and not viable within our province. The problem is real. The changes required will be huge and costly.
Our farms need to be financially strong to make strategic changes to lessen the impact of weather changes. Our association is developing research relationships. It is difficult for the primary producer to develop a dialogue with researchers, but it is necessary to develop that dialogue. If we do not, then the effective use of our research dollars, which are limited to promote better agriculture output and improve our quality of life, will not happen.
A key area that our association has worked hard on is our recommended list. That is the list of the four field crops we deal with, namely, corn, forages, cereals and soybeans. It has been the mandate of our membership to maintain this list, and we are struggling to do that. This research discharges 75 per cent of the germplasm that comes into the province before farmers get it, so it saves us huge amounts of time and effort to find which varieties and hybrids we should be growing. We are coordinating this project with NSAC and our Agricultural Development Institute.
Research funding can play an important role in Nova Scotia. Some of our commodity organizations, including our organization, Horticulture Nova Scotia and other lesser-funded organizations, would like to have the ability to take administrative costs off research projects to fund the organization, so that we can have annual meetings and regional meetings with the producers. This is currently prohibitive with most federal funding. They decided that was not a good use of funding dollars. I would suggest that it is a wonderful use of funding because, if our farm organizations die, we lose our collective cohesiveness and our ability to react rationally to these changes.
The national action plan on food safety, innovation, and environmental protection are great buzz words. I firmly believe the we have safe food now. Our farmers are utilizing environmentally sustainable practices and are environmentally responsible. Primary producers and associate processors are innovative but we can improve. Is it best to just focus on these three areas? Our farm organizations and leaders are aware of the need to maintain and improve our confidence with our markets, but our customers and our consumers will be demanding environmental sustainability and food safety, and they will write those into our contracts for our agricultural products.
I will be very disappointed if this becomes a government-led initiative. I would hope that the farm industry, farm organizations, take the leadership in this area and develop what needs to be done. This need not be a documentation nightmare for our farmers. If the farmers end up doing all kinds of paperwork to cover their trail and to make things happen, they will not have the time or the ambition to be innovative.
As to international trade, since I am a dairy farmer, I vote for supply management. I do not discount the other commodities within Canada. I am not learned enough to talk intelligently about them, so I do not have an opinion on that, but supply management leaves us with very consistent returns and it ties the production and the supply of the product to the demand in the marketplace.
The best reason I have heard for supply management is that an individual farm unit slowing agriculture input over a season will never influence the price of that commodity. Supply management overcomes this economic reality, leaving farmers in reasonable control to help price their product. A strong agriculture core will lead to an agricultural infrastructure that will help other agricultural sectors maintain and stay viable within a region.
Our agriculture sector is made up of strong, resilient primary producers. Help them by providing the resources they need. Foster cooperation among all stakeholders and listen to our farm leaders. They will provide you with the right direction needed for our industry.
The Chairman: I am very encouraged to see a young, enthusiastic farmer appearing before us, because we certainly need to deal with the next generation and hope that they can be sustained.
You talked about generational transfer from father to son. You know that under our tax law that puts the father in quite an awkward position if he needs some way to continue his livelihood. However, a new bill was passed that deals with the financial lending by government to farmers. We supported passage of that bill. It will allow a certain amount of monies to go to the farmer so that the farmer can get a retirement income from his farm and still continue to farm. Of course, generational transfer is most important. You can transfer the machinery and the land. You cannot transfer the commodity that is on the farm. However, the importance of having something for the senior farmer to live on is a priority, and you made that point.
I think that we need more studies on where globalization will take us. I see the marketing boards insulating you from globalization, but that does not apply to grains and oil seeds. We are into an era of globalization. There is no question in my mind that the Americans and the Europeans have recognized this, and that leaves us sort of dangling out there in the air in Canada and Australia and probably New Zealand. The major players will trigger what will take place. What is your view of globalization?
Mr. McCurdy: In terms of globalization, you are right, our supply management commodities have insulated us from the players outside of our borders.
The Chairman: But for how long?
Senator Tunney: Forever.
Mr. McCurdy: The question is: Is it good for us?
The Chairman: There is no question that it is good for the dairy producers.
Mr. McCurdy: Is it good for you as a consumer of dairy products?
The Chairman: That is probably where the problem will arise.
Mr. McCurdy: If we globalize the production of our feather industry and our dairy industry, will you have access to cheaper products? Is that the goal? Is the goal to have rural communities actively farming as the Canadian government? Is it cheaper to produce milk in Vermont and New York State and ship it back up here to Nova Scotia; or is it cheaper for us to have a dairy farm in Nova Scotia and a farm machinery dealer and a feed dealer and to have an economy? If you have your dairy farms in New York State, you will be distributing welfare payments in Nova Scotia.
The Chairman: I agree with your point. I would not want to take anything away from the dairy producers in Canada. They have been insulated in a way that other agriculture has not, particularly grains and oilseeds. I would not vote for taking that away, but the first statement Americans will make, not to the farmers as much as to government people, is that Canada must remove its marketing boards before they will open the border. That is what they tell us.
Mr. McCurdy: That is what they want because it will create a free market for them.
Senator Tkachuk: What is wrong with that? Saskatchewan also has a dairy industry.
Mr. McCurdy: That is because we are tied to markets.
I am also a minor birdseed producer within Nova Scotia. I made sure I had a market before I even put the seed in the ground. However I know some of my peers in the province who will put wheat or barley in the ground in the hope that they will be able to sell it in the fall. I do not believe that is smart business. We need signed contracts before we start. Our commodity boards give us signed contracts. I know when I sit down with my family, with my banker, that I can ship a certain amount of milk and I that I have so many dollars to start with.
Western grain farmers do not know that definitively.
Senator Tkachuk: That is because we produce a surplus.
Mr. McCurdy: Is it smart to produce surplus?
Senator Tkachuk: I am referring to surplus for trade. The wine producers use exactly the same argument you use. They told Brian Mulroney that if he did this, their industry would not survive, that they would not be able to compete. I remember all the arguments. In actual fact, they competed wonderfully well and their increase in sales has been substantial since free trade because, as you know, they make pretty darn good wine.
Mr. McCurdy: Is there more wine being consumed or did they take production away from other markets, other production areas?
Senator Tkachuk: That is not for me to say. All I can say is that they are surviving. In fact, they are doing extremely well. However, you are saying that we should close the markets only produce product if you have signed a contract. No one would ever have made a television set if that had been the case.
Mr. McCurdy: Television sets are not agricultural commodities.
Senator Tkachuk: They are commodities.
Mr. McCurdy: They are not perishable.
Senator Tkachuk: It is a commodity and they are perishable in the sense that new designs come on the market. The technology goes out of style and the television sits on the shelf and it is not sold.
You have a guaranteed contract, and there are restrictive quotas. It is difficult for new people to get into the marketplace because quotas are expensive. How much is your quota worth?
Mr. McCurdy: It is about $30,000 a cow.
Senator Tkachuk: That is probably more valuable than the land you have.
Mr. McCurdy: As an asset to take to the bank, yes, it is.
Senator Tkachuk: That is what I am saying.
Mr. McCurdy: People say quota is an asset, but I believe that quota is a market.
Senator Tkachuk: As a consumer, I cannot go to the local farmer and buy milk from you because you have a quota.
Mr. McCurdy: It is not safe for me to sell milk to the local consumer from the bulk tank.
Senator Tkachuk: No, but I cannot enter into a contract with a farmer.
Mr. McCurdy: Then you will have taken the market away from me.
Senator Tkachuk: I wish we could have a guaranteed market.
The Chairman: I am now questioning whether I should have opened the subject up.
Senator Tkachuk: It is a good subject. We should talk about it.
The Chairman: Globalization is a reality. The United Nations, major players, realize that we have a world population that has to be fed. I think the Americans and the Europeans have come to the conclusion that it is more politically acceptable to support farmers, give them a good price for grain, than it is to do ``giveaways,'' if I can put it that way, to feed the third world. Someone has to do that. We have a responsibility. Canadians and those people who live in the western world are very fortunate people. However, we represent only about 10 per cent of the world's population. The United Nations is trying to find a solution to this problem. At one time the world banks moved in quite extensively, but they have retreated from that position.
I just talked to the Minister of Agriculture from Nigeria at the prayer breakfast. There is a different world out there. What can we do about it?
Senator Wiebe: I just want to comment on the previous two presentations. Marketing boards work because marketing boards relate to the demand within the country. That is why marketing boards have been successful in Canada. They look after the supply of milk, for example, within this country, and their price to the producer is guaranteed. If the farmer overproduces, then that is available for export, but the farmer is not guaranteed the price on that overproduction. He gets whatever the market will bear. It is difficult to bring wheat and grain under a marketing board situation because we have always been exporters. Once you are exporters and you have to depend on the world market, you cannot control the price of that grain.
You are fortunate to be able to control the price of milk, eggs and poultry. It is a country market. I am a very strong supporter of marketing boards for eggs poultry and milk. The boards have done a tremendous job of keeping more farmers on our land than would be the case if they did not exist.
Your remarks at the outset of your presentation reminded me of myself when I started farming. I started farming on three-quarters of land. In Saskatchewan that is a drop in the bucket, but here it is a fairly large piece of land.
You said that, as a young farmer, it is your hope and intention to expand your operation. Of course, you know that some farmers will drop by the wayside. I also told people that I was going to be bigger than I was.
As politicians we continuously talk about wanting to see more farmers coming back to the land. We want to preserve our rural spaces. Yet, the farmer himself does not want to do that.
I read a book the other day on agriculture where the statement was made that rural depopulation started the day the tractor was invented. That goes back a heck of a long time. The farmer had more time on his hands. Because he had a tractor, he could cover more acreage. Therefore, his horizon grew larger and he wanted to expand his farm.
My grandfather moved from Kansas to Saskatchewan in 1905 because there was no more farming land available for farming in Kansas. The farms had grown in size. Of course, that is just natural.
Are we, as governments and politicians, beating our heads against the wall or are we fooling the farmers and the general public by saying that we want to repopulate the farms with people, when the actual people involved in the industry do not want to stay the same size, in fact, they want to grow? Is that a fair assessment of the mood?
Mr. McCurdy: I think you are accurate. I believe that our farms will come in two sizes. We will have the corporate farm, most of which will be run as family farm businesses. They will produce the core business of producing, wheat, dairy, poultry, beef, hogs and whatever. They will specialize in that. Then there will be small, hobby-type farms with significant off-farm income in order to raise a family.
I think the government is struggling with trying to create vibrant rural economies. Farm organizations are facing the same dilemma because we have a large, focused, core group of farmers who want to go this way and another larger group of people who want some lifestyle associated with their hobby farms that they support with additional income from elsewhere.
Senator Wiebe: That is another interesting suggestion you make when you talk about the direction towards corporate farming. I would like to include in that not only corporate but also cooperative farming. This is one area that I think agriculture should be looking in regard to intergenerational transfers. It is much easier to transfer a share of the farm than is to transfer the entire farm, so there should be ways of setting up farm corporations and structures so that the transfer from older farmers to younger farmer can be done in such a way that it is not a fantastic burden.
Senator Oliver: Earlier this morning we had a presentation from Jean-Louis Daigle, Eastern Canada Soil & Water Conservation Centre.
The heading on your paper is ``Soil & Crop Improvement Association of Nova Scotia.'' What is your relationship with the Eastern Canadian Soil and Water Conservation Centre, if any?
Mr. McCurdy: We certainly interact. They have made presentations at annual meetings and whatnot. They are a very useful resource for extension if we need specific research into a certain area. This month, Ducks Unlimited will come in and make a presentation to a group of farmers on a conservation club. Some of the contacts were made through the centre.
Senator Oliver: Is your organization, doing work on behalf of Nova Scotia farmers to help them with soil erosion problems and soil quality problems?
Mr. McCurdy: That is certainly part of our mandate, yes, but not exclusively.
Senator Oliver: Who funds your organization? Is this a provincial organization?
Mr. McCurdy: It is a provincial organization.
Senator Oliver: Is it the provincial government that puts in the money?
Mr. McCurdy: I wish.
Senator Oliver: I was doing pretty well there for a minute.
Mr. McCurdy: That is where I led our counterparts in New Brunswick, the New Brunswick Soil & Crop Improvement Association. That is an active, vibrant organization that is implementing and directing $900,000 worth of research. It takes administrative fees off that to fund its organization. Some of that $900,000 is CARD money, the money that every province received. The rules in New Brunswick allows that organization to have administrative fees. Nova Scotia rules do not allow for that. The provincial gentleman who oversees told us that the federal rule does not allow us have administrative fees. That is why I raised that matter in my brief.
To run our organization, a bare bones union, it costs us approximately $6,000 to $10,000 a year. We will run a $600,000 deficit this coming year. We made $12,000 on our last conference. We hope to continue with our conferences and to make good revenue from them, but that has to carry us for two years. It is a daunting task to have an organization.
Senator Oliver: The minister will be here this afternoon. Maybe you should hang around and lobby the minister. You can explain what is happening in New Brunswick.
Mr. McCurdy: There are other things I want to talk to the Minister about.
Senator Oliver: I am from Nova Scotia and I am delighted with your presentation. It is wonderful to see a young farmer coming forward with so much optimism.
Senator Tunney: As I was listening to your conversation, I came to the conclusion that agriculture in Canada needs a lot more young people who are articulate thinkers like you. The success of agriculture will only come about if you, someday, become Minister of Agriculture or you are in a position to influence that minister.
You had an interesting exchange with a member of our committee who is not a totally dedicated supporter of supply management. Some people in Canada believe that supply management works against the general good. You, and I hope more people, know that it is because supply management in agriculture works for some commodities better than it does for others, and that it cannot work for all of them.
The dairy farmers are going bankrupt because the dairy farmers in the U.S. are not sharing in the profits of the dairy industry. The processors, distributors, and retailers are very profitable. The Canadian system demands that the producer gets his share, and we can produce a product at less cost and sell it at less cost than they do in the U.S. However, the dairy farmers are in very bad shape despite the high subsidies they receive.
Mr. McCurdy: There is some talk in U.S. trade publications that their dairy farmers would like to have supply management.
Senator Tunney: Approximately 90 per cent would, yes.
Mr. McCurdy: However, the U.S. government will not allow that.
Senator Tunney: A lot of dairy farmers are talking about expansion. In Ontario the most profitable dairy farmers milk between 55 and 60 cows. I do not think we will ever be in trouble with the WTO as long as we do not move to big corporate farms that the WTO will have to come down on. There could be a dogfight between large corporate farms because of the amount of influence large corporate companies and industries have. I hope we retain family farms to the point where we will not see a dustup between us and globalization.
Mr. McCurdy: It is interesting that you mentioned the 50- and 60-cow dairy herd in Ontario and said that it is the most profitable. If you look carefully at those numbers, you will see that that comes from labour efficiency, and the labour efficiency of a 50- to 60-cow dairy farm most likely will be a one family per unit. To get to that labour efficiency again, you have to have 800 to 1,000 cows with the right number of employees. We do not have the labour efficiency that a 50- or 60-cow herd does. We have a magnitude of scale that realizes us an income, but we do not have the labour efficiency.
Our peers in America who would like to have supply management cannot decide on how to sell that concept to their government. To help them with that, may not be a role that would be prudent for the dairy farmers of Canada to assume. If the United States had a commodity that was subject to supply management, it would change globalization and world trade talks significantly. That may be a real good avenue to take to protect our agricultural economy in Canada from globalization. We should not fight with the negotiators but attack the problem within other countries and implement a system that is fair, equitable, and makes sense for those other countries.
Senator Day: I am concerned about what you had to say about low margins.
You also seem to be convinced that climate change is here to stay. Your final comment was that this problem is real, that change is required, and that they will be huge and costly. You mentioned an increase of 200 to 300 heat units, and you said that we must start planning production strategies to deal with this change now. Am I reading you right here?
Mr. McCurdy: Yes. If what we have seen in the last five years continues, agricultural production in Nova Scotia will change. On our home farm we have already changed the manner in which we produce forage for our dairy cows. We used to take a significant first cut, a significant second cut, and some third cut. We changed that. We take a huge first cut because the second cut does not come sometimes. Once we know that our first cut is in our silo, and the corn crop grows, we are confident that we can get through until the next growing season.
If our heat unit changes from 2,400 to 2,800 in the same water, can we adapt that fast? I do not know the answer to that. Ask me in 20 years.
Senator Oliver: Is irrigation not part of the solution?
Mr. McCurdy: I question whether irrigation for low value commodity crops like field crops is worthwhile. Is it sustainable? Those are some real questions. It may be part of the solution.
Senator Day: It takes money to adapt or change. You talked about farmers having such low margins. They will be unable to adapt.
Mr. McCurdy: That is not so. If your biggest struggle today is to find food for your family tomorrow, can you change enough to figure out what you have to do to produce food in three years time? I think some of our agriculture producers think in that vein now.
Senator Day: Do you see that as the most significant challenge over the near to medium term for the agricultural industry?
Mr. McCurdy: I am not sure, because we are dealing with so many different things, nutrient management planning, environmental sustainability, and production. I have heard and read enough that I do not believe the experts on climate totally agree yet.
Senator Day: You are not totally in agreement that the temperature is slowly increasing in this area. There has been a climate change and there is less water now than there used to be, less precipitation, is that so?
Mr. McCurdy: My home farm has not been greatly affected, so I cannot talk from the perspective of having had a severe personal experience.
Senator Day: If it is happening, you agree that it is a very serious problem. However, you are not sure, is that so?
Mr. McCurdy: Yes. The 2001 growing year was a fabulous year. We had to build more silos up to store everything.
Senator Day: That is good, but many people did not have that same experience.
The Chairman: I would thank you for a very exciting presentation.
Mr. McCurdy: Thank you. Have a good day.
The Chairman: Honourable senators, we invite to the table our next presenter, with the Dairy Farmers of Nova Scotia, Mr. John Vissers. Welcome, and we look forward to your presentation. We have approximately half an hour.
Mr. John C.H. Vissers, Chair, Dairy Farmers of Nova Scotia: Thank you for the opportunity. Good morning, ladies and gentlemen. It is my pleasure to share some comments with you on behalf of Dairy Farmers of Nova Scotia. Before proceeding, I would like to give you an overview of our organization.
Dairy Farmers of Nova Scotia is a milk marketing board created on April 1, 2001, under the authority of the Dairy Industry Act in Nova Scotia and is funded by the 350 dairy producers in that province. Responsibility for the day-to- day activities of Dairy Farmers of Nova Scotia is in the hands of a nine-member board elected by our producers.
The province's 350 producers market approximately 170 million litres of milk per year. Dairy Farmers of Nova Scotia, in turn, sells this milk to a total of seven dairy processors located here in the province. The province's producers also are participants in the six-province all milk pool, commonly known as the P-6, as well as active participants in the Canadian Milk Supply Management Committee, which administers the national milk marketing plan.
The dairy sector is the largest single component in Nova Scotia agriculture and has often been called the backbone of our agricultural industry. As the largest single sector, the dairy industry plays a key role in supporting many of the service businesses that are essential to other segments of the agricultural industry. Dairy producers are significant customers of our veterinarians, feed suppliers, machinery dealers, et cetera. Much like it has allowed a dairy industry to prosper from coast to coast in all of our provinces, supply management in Nova Scotia has allowed dairy production to take place throughout Nova Scotia and provides this network support from one end of the province to the other.
I would like to talk a little about the supply management system that is such an integral part of the dairy industry. This ``made in Canada'' marketing system has been in place for close to 30 years and continues to provide many benefits to the country as a whole, not just dairy producers. The price stability resulting from supply management allows operators of well-managed dairy farms to plan their affairs and prosper. More important, it eliminates the need for government intervention to deal with short-term pricing problems. In fact, just recently, on February 1, 2002, the federal subsidy on milk production was completely phased out, meaning that dairy producers across the country now obtain essentially all of their returns from the marketplace.
The supply management system depends on government support for its continuation. A key message that we would like to convey is our expectation that this strong support at the federal level will continue to allow Canadian dairy producers to manage their affairs and provide good quality milk to Canadians at a fair price.
In your invitation to this hearing, you indicated you were interested in gathering information on the reaction from stakeholders to the national action plan to make Canada the world leader in food safety, innovation and environmental protection. Dairy Farmers of Nova Scotia supports these objectives. In fact, we are in the process of implementing the Canadian Quality Milk Program in Nova Scotia. This program, developed by Dairy Farmers of Canada, aims to make Nova Scotia a world leader in on-farm food safety. In addition, many of our members have developed environmental farm plans, and we will continue to promote this proactive approach to protecting our environment. It is our view, however, that implementing this plan would benefit all Canadians, while agricultural producers may have to carry out many of the necessary activities. The costs should be divided in an equitable manner among all who will benefit.
You also asked us to comment on the impact of the 2001 drought on agriculture. In this province, 2001 was simply another year in a string of recent cropping seasons where the rainfall was significantly less than the norm that we have come to expect. There does appear to have been a fundamental shift in our climate and the impact on our sector is significant. Higher summer temperatures, combined with lower levels of rainfall, have significantly reduced yields of forage crops and grain crops in recent years. Producers are responding to this shift and have made adjustments in their cropping programs.
The field crop production that underlies milk production in this province does not lend itself, for the most part, to irrigation activities. The challenge will be to obtain the maximum benefits from the limited rainfall that Mother Nature deposits on our fields. We will need information on cropping systems, on varieties, et cetera, that will allow us to cope with this reduced water regime. In this regard, one of the ongoing needs will be a system of cultivar evaluation to ensure that we have identified the varieties that are best adapted to the climate in this part of the world. Such activities are considered to be ``green programs'' under the WTO. We are concerned that there may be a trend to decrease funding for those types of activities, which can be very useful to agricultural producers and are clearly permitted under the WTO agreement.
Dairy Farmers of Nova Scotia supports the federal government in its efforts to defend our supply management system against the most recent challenge by the United States and New Zealand. While exports do not represent a huge volume of our production, they have helped producers and processors in this province to develop an export orientation and some expertise in this area.
As far as the new WTO negotiations are concerned, the essential element for Dairy Farmers of Nova Scotia is a continuation of tariffs that will allow our domestic supply management system to remain. Due to the mature nature of the dairy market, we do not see an increasing share of the Canadian market served by imports. Tariffs must be maintained at a level that will allow efficient dairy producers to operate their business and continue to provide Nova Scotians and Canadians with high quality milk and dairy products.
I will be pleased to entertain any questions that you may have.
The Chairman: Thank you for that presentation. We have just had an interesting discussion with the last presenter about dairy production.
Mr. Vissers: I heard that one.
The Chairman: Obviously, as indicated in your presentation, you are a strong supporter of marketing boards. Do you produce more milk in this province than you consume?
Mr. Vissers: Yes, I would say we do, but on the other hand, our share of the national quota is less than our population would suggest. If you went by our population, we would have about 4 per cent of the national quota. I think the quota within this province on the MSQ side is closer to about one and a half, so our portion is quite a bit smaller.
The Chairman: Your quota is smaller than your population?
Mr. Vissers: Quebec, for instance, has close to 50 per cent of the quota.
The Chairman: Forty-nine per cent.
Mr. Vissers: Forty-nine per cent? Yet they have 25 per cent of the population. We do produce more in this province, but on a quota basis, we are pretty well on target. Last year, we were slightly under for what was utilized.
The Chairman: On that point, in Saskatchewan, for instance, there is a question about why that province does not have more or a fair amount of quota. The same thing is true of British Columbia, Alberta, Manitoba and so on, because the system does give the eastern part of Canada a tremendous boost, and a political one, I must say, having sat here for 20 years, either in government or in the Senate. I just make the point that that is very obvious.
I am not one to undermine the dairy producers or the system. I think it has worked well, but I think there should be some consideration given to all of Canada. However, on the other hand, it is very obvious that this area is really well suited to dairy farming. I view your problem here, and you can correct me if I am wrong, as getting feed to the Maritimes. Of course, in Saskatchewan that is not a problem because we are exporters of grains and oilseeds. I just make that comment.
Senator Oliver: I would like to ask a question about something a little different from supply management. One of the things that we are interested in hearing about is so-called ``value added.'' With dairy, one of the value added products is cheese. Can you tell me about the cheese production in Nova Scotia, why is it not greater, and what steps are being taken to increase that and perhaps other products?
Mr. Vissers: My understanding is that there are only three processors producing cheese in this province, the main one being the plant here in Truro, which is more of a plant of last resort. They mostly produce cheddar cheese, which is a more common one and does not take long, as happens in the other provinces too when there is an oversupply that is hard to move. There are two other, very small processors. One is up in the Parrsboro area and processes cheese in the old style. He is a Dutch fellow, and his challenge is to try to compete in the marketplace because his operation is so small. He does produce a nice cheese. He is into making some other cheeses. He sells a blue cheese in small containers and that has been quite profitable for him. However, that is a very rich type cheese and not everybody eats that, so he has to find the right market.
There is also another cheese maker down in the Valley who makes a different type of cheese, but that is more for the Montreal market. I cannot explain what kind it is, but it comes in buckets. That is about all the cheese production. I think part of the reason has been that the industrial base has never been very big in this province, and so there has probably not been a lot of emphasis on trying to grow more markets for cheese. However, we are probably second to Ontario in producing ice cream. We have two fluid processors here that are quite heavily into ice cream and it has been a challenge to them to obtain enough cream to supply that.
Senator Oliver: Yoghurt?
Mr. Vissers: There is a processor that produces some yoghurt, but he has a hard time competing with the ones from Central Canada because of the sheer volume. However, the two ice cream processors have probably spent significant dollars in the last few years trying to grow that market.
Senator Oliver: Is your association looking at other and better ways to enhance your bottom line with value added?
Mr. Vissers: We are. We do support some research being done at the college here on opportunities for niche markets with milk products. One project is looking at CLAs in milk. Where there are a lot of cattle in our province that are still on pasture, they are monitoring those cows to see if the CLAs are higher during that period of time. If that is a possibility, they can trace which grasses or whatever would be responsible for that compared to when the feed is ensiled. There could be some niche markets there, because there is a health issue with the CLAs. There are some possibilities out there, but they are challenging. It is one thing to identify them, but then you have to find markets. The other issue is, even if that research is successful, how do you segregate the milk? Right now, milk is picked up from other farms and goes to the dairies. It is only a small market and you have to keep that milk separate to serve it.
Senator Oliver: Separate, exactly.
Mr. Vissers: That becomes an issue.
Senator Wiebe: I am interested in your comments on page 3 about climate change. Senator Day asked a previous witness about the effect of climate change on his particular farm and he said it was not a problem. He is producing more than ever. In your brief, you say that there has been a serious lack of rain in recent years, and at the end of the first paragraph you say, ``Producers are responding to this shift and have made adjustments in their cropping programs.'' What kind of adjustments?
Mr. Vissers: I would say the biggest change in our area, in the Stewiacke area, is in the number of producers going back to growing corn for silage. Twenty-five years ago, a lot of people were growing corn silage, but then there were a few wet years, the fields were not tilled at that time, and people had a difficult time in the fall getting the silage off. Many of them stopped doing it and just grew mostly grasses. However, in the last few dry years, the corn silage has actually saved them because they are able to get some volume from that.
Senator Wiebe: That is encouraging. I think that our farming practices have changed dramatically over the years and they may have to continue to change. In my province of Saskatchewan, for example, many areas got less moisture than during the driest years of the '30s. Now you are too young to remember the '30s, but you have heard about them, and yet they produced above average crops. It is certainly clear that there was a drought, although it may not have been province wide. There were pockets where more moisture did fell than in others. I am glad to see those kinds of changes. Thank you.
Senator Hubley: My question also has to do with climate change, and we have heard a lot about how it is affecting production of the crops to support the industry. How does it affect the livestock? Have there been any studies to determine if there are going to be some changes or conditions in livestock themselves that we are going to have to address?
Mr. Vissers: The biggest challenge on our own farm is trying to supply water for the cattle in the summertime, when it is dry, and in the fall. We actually have a tidal river running by our farm, and years ago, the tide only used to reach as far the barn, and after that it was always fresh water coming down. However, during the last few years, when it has been so dry, the tide goes up so far, and there is so much mud going into the river, that we cannot use that water source. We go with dug wells. We are right on intervale ground, and we cannot dig deeper than 20 feet because the ground continues to collapse. We have got to a point now where we have drilled some wells with sand screens that go down about 30 or 40 feet and we are able to get water. We did try drilling down about 120 feet until we hit some rock and also hit salt water. That did not help either. There are real challenges. Our neighbours up the road are not even that fortunate, because there is a lot of gypsum on the other side of the river where they are, and they have to rely mostly on ponds. The big challenge is to make the ponds large enough to trap sufficient water in the summer to get them through the fall. As the farms expand over time, the water supply for the cattle becomes a big challenge. It is an issue on the cropping side, but also on the cattle side.
Senator Hubley: Have farmers been taking the initiative? Are they making changes, building the ponds? Are they going to build new ponds or depend on existing ponds for this water supply?
Mr. Vissers: In hindsight, I think that was not taken that into consideration when some of the expansions took place. The federal government actually announced last fall that it will spend $300,000 in this province on water studies. A couple of people from the federal government were here a few months ago. It was my understanding that they were here to see where that money would be spent, and they thought mostly in the Valley, where it is largely dry in the summertime. However, even in my area, some farmers were very concerned that they had no water supply through the fall and that some work was needed there. The experts said it is not an issue of trying to find water, but of learning how to harness it, because there are brooks and streams there in the springtime. It is just a matter of storing the water in the right places and having big enough ponds to contain it through the fall when it is dry. It is more a question of taking that initiative, and I believe some of the work needed to solve those problems is to be done this spring.
Senator Tunney: John, I know that you have a very vibrant dairy industry here in this province, and I have had a lot to do with it for many years. It is getting better all the time, but not without a lot of extra effort and professional management.
The question was raised, how come Nova Scotia or Saskatchewan does not have more of the national quota and how come Quebec has so much? The quota was set nationally on historical performance. Quebec has what it has because farmers are willing to produce lower priced milk for powder that goes onto the world market at a low price. They have always done that, but your producers, and Saskatchewan producers, get a much higher price for the milk that they ship because a much larger percentage of it is at fluid price instead of industrial.
I just hope that you continue, as I know you will, supporting supply management. As chair of the board for your organization, you have a real opportunity to talk to the people who will be representing us at Qatar in the new round of negotiations.
Mr. Vissers: Just to touch on quotas again, Nova Scotia had the opportunity, 20 years ago, to receive a little more industrial. I think that was before it even went to equalization. The quota was based more on the processors' regime and they were not interested in producing the lower quality milk. They were interested in fluid. Over the last five years, I think, since we went into the P-6 agreement in 1995 and 1996, we have shared the markets within P-5, so even though there is more industrial in Quebec, we share the returns within the P-5. Therefore, I get the same price for all my milk as a producer in Ontario or Quebec. Part of the reason we did that was to provide more of an insurance plan within our pool of protection, so that if something happens in one part of the province, or with a processor or whatever, such that we cannot market the milk, that is shared amongst us. We are still hopeful that some day, there will be a national pool. In both the East and the West right now, it is basically a P-4 or a P-5 or P-6.
I would like to comment on one more thing. I have an aunt who lived in England, although she is back here in Nova Scotia now, and for many years she lived in Ontario working as a nurse. She moved back to England about 15 years ago with a friend. Given the issues there over the last few years, with the BSE and hoof and mouth last winter, we can be quite thankful for the quality controls we have here through Health Canada. She would not eat meat after she went back home to England. The only time she would eat meat was when she came here to visit, and then she would just love it. Like she said, it was just a real treat. We often take our situation for granted because we are not exposed to anything else. We do growl that food here is expensive, but there it is three times as much.
I am such a supporter of supply management. In England, when they deregulated the marketing board's ability to set price, it was thought that the price to the consumer would be reduced, but all it did was reduce the price at the farm level. Nothing else happened. I believe the same thing occurred in Australia when they deregulated supply management. It was thought that that would reduce the price to the consumer. It reduced the price at the farm gate by about 30 to 40 per cent, but at the consumer level it might have been reduced by about 5 cents a litre. One of the challenges in this country is that the retail level is so strong. There are really two main retailers here that account for about 49 per cent of dairy products sold. The processors almost have to cater to them because they cannot afford to lose one of those markets. The biggest plus for producers in supply management is that it does give us a level of protection. If they took it away, would that guarantee a lower price to the consumer? I do not think so.
Senator Wiebe: I have one more question about climate change and the higher summer temperatures. I should have asked this of witnesses earlier, but how high above sea level are you?
Mr. Vissers: I am not sure.
Senator Wiebe: I ask that because this is a coastal province. I should have maybe asked the question in New Brunswick, but I have heard that at the rate the ice cap is melting, we risk losing substantial amounts of coastal land as a result of the seas rising. Has that been a concern or a topic of discussion in Nova Scotia?
Mr. Vissers: I do not believe so, although we are on intervale ground and there is marshland around there. My father came from Holland many years ago, and the first thing we did when we moved here in 1967 was to build a dike around the river. He asked the farmer he bought the farm from if he ever had a problem with flooding. He replied, ``Oh, never much,'' but one winter, the ice broke, because usually we have a January thaw, and the ice landed right on top of the dike. The next year, the dike became bigger.
The Chairman: Thank you for appearing. It was very interesting. I want to welcome Dr. David Percival, from the Nova Scotia Agricultural College. I understand that he is interested in blueberries.
Dr. David Percival, Research Professor, Department of Environmental Sciences, Nova Scotia Agricultural College: I am hoping that the technological expertise can help us. I have had a bad morning, with computer problems, printer problems, and now some AV problems, but hopefully, things will catch up. I have been in meetings with several of the wild blueberry producers' organizations in the Atlantic region, so I would like to give you an idea of the program with which I am involved, and some of the challenges that are going to be facing us over the next five to ten years.
The wild blueberry industry is very unique, both on a national as well as an international basis. We are dealing with a wild crop. In other words, we are trying to manage naturally occurring vegetation in the form of these wild blueberries. It is quite ironic that the areas in which these plants grow are deemed mostly unsuitable for other crops. We have really seen the crop develop into something of considerable economic importance to the region.
We are now dealing with a 200-million-pound crop that is produced predominately in Maine and Atlantic Canada, as well as Quebec. Typically, Maine produces approximately 40 to 50 per cent of the wild blueberries, with Nova Scotia and Quebec making up probably another 40 per cent, and then to a lesser extent it is produced in New Brunswick and P.E.I., as well as Newfoundland.
One of the challenges facing the crop right now is oversupply. Approximately 10 to 15 years ago, the total amount of wild blueberries being produced was in the 130-million-pound range. This increased to approximately 160 million pounds about four years ago. We are now facing a situation where we have 200 million pounds of blueberries being produced.
If we look at the reasons for this, improved management practices do play a role, and you will see that if our presentation catches up to us. Also, an increasing land base is being converted to production. The land base in the State of Maine itself is slowly increasing, whereas in Nova Scotia, due to programs to facilitate the establishment of blueberry land, the actual quantity of land has gone up quite dramatically. We are now trying to find the markets and the uses for these crops.
Just to give you a little background information on where I come into play, I am the wild blueberry research professor here at the Nova Scotia Agricultural College. The position is funded by producer organizations such as the Wild Blueberry Producers Association of Nova Scotia. We also have research support from New Brunswick and P.E.I. and processor support in the form of Oxford Frozen Foods and Bragg Lumber Company.
That is how the actual research program is focused. The overall mandate of my program is to increase the yield potential, believe it or not, as well as try to improve the long-term sustainability of the crop, because climate change is a concern. We have had two very dry years in the past three. This past summer was the driest we have seen in quite awhile. We had estimated 45 to 50 million pounds in the field in July, and the five-year average in Nova Scotia is about 30 million pounds. We had an excellent crop in the field at the end of June, early July, and essentially, it just dried up.
Therefore, one of our mandates over the next five to ten years is to look at improved irrigation management practices for use with wild blueberries. Irrigation is used quite extensively in Maine right now. We are also looking at improved management practices on non-irrigated land to try to improve the crop's tolerance for drought stress.
Those are the challenges we are facing. Now there are health benefits to be obtained from this fruit. Over the past five to ten years, we have been able to really advance the overall perception of the fruit and show how the healthful benefits have always been there.
Research activities have demonstrated features similar to what is noted in cranberries with urinary tract problems. We have also seen, in the case of the blueberries, improved short-term memory as well as vision benefits. Some work is going on right now at the University of Prince Edward Island on heart disease and cancer prevention. There are some very interesting features to the flavonoid content of the fruit and that has implications for the industry.
My research activities focus on trying to improve the crop itself from a yield, quality and composition aspect.
I would like to raise two concerns of the wild blueberry sector, and as far as the producers are concerned, the wild blueberry industry.
The first issue deals with the registration of new inputs, and in particular, new pesticides. We belong to a group of horticultural crops known as ``minors.'' We have to go through the minor-use registration process.
In the United States last year, 1200 new products were registered for use in the agri-food sector. In Canada, there were only 18. We are really beginning to fall behind on the use of new products for protection of the crop. The producers wanted me to convey today the challenges that we are facing. It has a direct impact on our ability to be efficient within the agri-food industry, and to go one step further, where we are trying to get away from the use of compounds such as organophosphates. We need to catch up on these new products, because they are definitely more user friendly and more environmentally friendly on an input-use basis.
There is only one researcher currently screening new pesticides in the region, a fellow by the name of Dr. Klaus Jensen in Agriculture and Agri-Food Canada. There is a concern in the industry that when Dr. Jensen retires, in a year and a half to two years, this expertise will be lost. The impact on the industry will be quite significant, so that is a concern that I did want to convey to you today.
Just to give you a little more background, the industry itself is in a situation where we have 200 million pounds of crop being produced. It is the most important crop in Nova Scotia in terms of export sales, total value, and farm acreage from a perennial crop perspective. It is an extremely valuable commodity to the Nova Scotia economy.
It is mostly moved in the form of what is known as individually quick-frozen berries, which makes up probably over 90 per cent of the market. You can buy these individually quick-frozen berries off the shelf, or they are typically boxed up on pallets and sent around the world. Now the industry is trying to look at the development of new products, new value-added products. Some of the ideas that have come through over the past five years include extract powders and some semi-moist fruit in the form of blueberry chews. The berries are put into an osmotic solution, which draws the water out, and then used in cereals, granola bars, and that sort of product.
We are also in the process of developing some microwaveable frozen-dried berries, where the shape of the berry itself is maintained; it is just the moisture that has been removed. The advantage of products like these is there is not the same degradation of the flavonoid substances in the berry that other processes cause.
They are trying to develop improved value-added products, and hopefully, this will facilitate the continued growth of the industry.
Senator Hubley: What percentage of blueberries goes into wine making?
Dr. Percival: There are three wineries in the area, but they are small cottage operations; so my guess would be less than .01 per cent. To give you an idea of how things have evolved in the industry, one of the selling features of the crop is Time magazine coming out last year with an article mentioning blueberries as one of the top ten fruit groups for human consumption. There are definitely some health benefits.
We are hoping that this will continue; in fact, there is a movement afoot to try to have the label ``blue'' associated with blueberries. There is a lot of marketing work going on that is being coordinated by the Wild Blueberry Association of North America. The promotional aspects of this crop are being taken care of by this organization based in Maine.
Senator David Tkachuk (Acting Chairman) in the Chair.
Senator Oliver: You were talking about pesticides. In the tree business, the Americans have a lot of pesticides that they can use that we cannot, and the same is true for blueberries. In addition to aphids and so on, deer are a major problem. I live in Queens County, where deer are a major problem with everything we try to grow, including blueberries. What are you doing about it?
Dr. Percival: Bears are probably number one from a wider perspective because they have no problem with hives, and we really do rely as an industry on cross-pollination. Hive managers support cross-pollination. As for deer, electric fences are going up to try to keep them out of the more problematic fields. There is work ongoing on the use of ``deterrents,'' I suppose would be the best way to describe them. Some of these originated in Europe for use in the wine industry. People are trying to find more subtle ways of persuading these deer to go elsewhere.
Senator Oliver: What are some of the other pests?
Dr. Percival: The most challenging pest from a marketing perspective is what is known as the ``blueberry maggot,'' which is actually a minute worm. The fly lays its eggs in the berry. The berry develops, and then you see something very similar to what occurs in apples. You end up with wormy berries. That is a very big concern from a regional point of view because there are very stringent thresholds for levels of maggots in blueberries. We are in a situation within the region where trade barriers are being imposed as a result of the presence of these maggots. For example, in the past, we have not been able to ship fresh product to Ontario because of fear of spreading this maggot.
Senator Oliver: Freezing kills them, though?
Dr. Percival: Yes, but we end up with a problem in the higher end-use markets; for example, there are very low thresholds for the produce that is going to Japan. It goes back to the overall importance of us continuing to look at the use of new products, especially since there is this retraction in the use of organophosphates.
Senator Day: Could you tell me a little more about marketing of new products? Now I understand what your role is here, but what about the marketing of new products? You said Maine is the major producing area, yet when we come down the highway, we see the sign that says Oxford County is the home of all great blueberries.
Dr. Percival: To give you more background on this, there are reasons why Oxford has really developed into the wild blueberry ``Mecca,'' if you want to call it that. The first thing is access to international markets. It is very convenient to be able to gather the fruit there, put it into a container in Halifax and get it off to international markets. It is very well positioned from that perspective.
Second, there is the issue of labour availability. It is becoming more and more difficult to find factory workers in the blueberry areas of Maine, which is where the heart of the industry really was 30 or 40 years ago. They are facing labour problems.
The third feature that really facilitates the presence of the industry in Nova Scotia is the attractive utility rates compared to the State of Maine. They can run their processing plants more cheaply here.
Now, as to why that sign is on the Trans Canada, the largest plant that Oxford Frozen Foods has is situated in the Town of Oxford. It has the capacity to process in excess of 100,000 pounds of blueberries an hour. They have an older plant established there and they just opened up a new plant last year. They have two other plants in the Province of Nova Scotia, one at Half-Way River towards Parrsboro and one in the Annapolis Valley. Then they also have two sister companies in the State of Maine, so they are quite a large international organization.
Senator Day: Can you give us a breakdown on production? I wrote down 40 per cent for Quebec and Nova Scotia. Are they roughly even, 20/20?
Dr. Percival: They are, although I would say that Nova Scotia is a more intensively managed area. In other words, we have fields that are dedicated to wild blueberry production. In Quebec it is a slightly different situation. Quite a lot of product is essentially brought out of the woods in the Lac Saint-Jean area, although they do have some quite extensive commercial fields there as well.
In Nova Scotia, as I mentioned, a typical five-year average would be about 30 million pounds. In Quebec we used to think that it would be somewhat lower, in the 15-, 20-, 25-million-pound range. Being a little further north, they are more prone to spring frost, which will ultimately have a devastating effect on the crop during bloom. This happened a few years ago, when we saw a drop from the 20- to 25-million-pound range down to 5. In Nova Scotia, however, the climate tends to be a little more moderate, although there are areas that can suffer from frost.
Now the exception to the rule is what happened last year. You are never really sure what is going on in the wild blueberry industry until you go out and see the fields, because the rumour mill is always working. Quebec produced 55 million pounds of blueberries, so a phenomenal amount of product showed up on the market. In 1996, when I started in this position at the college, all of a sudden, 30 million pounds of bilberries, the European blueberry, started showing up from Russia. That presented some real marketing challenges.
Everywhere else in the Atlantic region, as well as in Maine, the yield was down slightly this year. We heard from the Wild Blueberry Association of North America last week that they are predicting a 40- to 50-million-pound carryover going into this season, so there is still a lot of crop to be marketed.
Senator Oliver: Notwithstanding the drought.
Dr. Percival: That is right.
Senator Hubley: What steps is the blueberry industry taking to address the climate change? If this trend in lack of moisture goes on for some time, will that be an issue?
Dr. Percival: Yes, to put things in perspective, irrigation is used quite extensively in Maine, particularly in the Machias area.
Senator Hubley: What kind of irrigation?
Dr. Percival: They have both above-ground — in this case, a small, solid-set sprinkler — and also the sub- or below- ground solid-set irrigation with which they use the larger irrigation guns. Jasper Wyman, a large processor based in Maine, prefers the solid-set, above-ground sprinklers, whereas Cherryfields, which is part of the Oxford Group, presently uses the large irrigation guns. Both companies have crews that work around the clock to get as much water on as possible.
The soils in Nova Scotia tend to be slighter heavier than in the blueberry production areas of Maine, so the water retention capabilities are also slightly higher. Also, I would say that the temperatures are not as high as in the interior of Maine, where the blueberry production areas are located. Therefore, I do not expect the actual demand from the crop will be as great.
The wild blueberry has an incredible ability to tolerate drought. We have conducted trials at the Nova Scotia Wild Blueberry Institute, which is about 15 miles from here, with less than 5 per cent available water in the soil, and yet the plant is doing quite well from a physiological as well as a growth perspective. It is a fairly drought-tolerant plant. However, we can run into problems, such as last year, when essentially, we did not get any rain after mid-June until the end of the harvest; in which case, your crops can easily be reduced by 40 per cent.
The general attitude in the industry right now, following on some irrigation studies that were done in the early to mid-1990s, is that irrigation in the case of the blueberry is only effective one year in ten. Therefore, I think that the majority of the growers will stay away from it.
Also, as was mentioned by the previous speaker, sourcing irrigation water is a real problem in a lot of these areas as a result of salt in the wells that are dug, as well as sourcing water from rivers. Overall, I do not anticipate that there will be as much urgency for irrigation in the crop as with other commodities. However, for people involved in the fresh markets, for example, the fresh-pack growers who ship produce to Halifax, it is of interest, because it will help with the berry size as well as overall fruit quality.
The Acting Chairman: Will you be able to e-mail your presentation to the clerk's office? Then it can be distributed to the rest of us.
Dr. Percival: Sure.
Senator Hubley: I have a very quick question on marketing. I am just wondering if the Tim Hortons ``blueberry burst'' muffin was initiated by the blueberry industry, or did Tim Hortons decide it was a good way to go?
Dr. Percival: I believe Tim Hortons made the first move, but definitely the Wild Blueberry Association of North America does play a role in marketing, as well as the processors. When you look at the consumption of wild berries in North America, two users make up approximately half the market. Tim Hortons is one; and some of the pie manufacturers make up the second. It is surprising how much impact a promotion such as this can have, although I cannot call it a wild blueberry muffin because the concentrate they use for the jam is in fact from high bush, but we are working on that too.
The other example is the company that was making deep fried pies for McDonald's. On a trial basis alone, that used 20 million pounds of crop. All it takes is a few hits. One of the other activities in the health food benefits area is including some base of the berries in some of the soy products such as tofu.
They are hoping that given the inherent nature of the tofu, which does not really have a lot of taste, they can create a nice meshing of attributes and a fairly healthy product.
Senator Leonard J. Gustafson (Chairman) in the Chair.
The Chairman: Our next witness is from the Nova Scotia Agricultural College, Dr. Kirsti Rouvinen-Watt.
Dr. Kirsti Rouvinen-Watt, Research Professor, Department of Plant and Animal Sciences, Nova Scotia Agricultural College: Honourable members of the Senate committee, I would like to share with you today a brief overview of the current status of the ranched fur industry in Canada and Nova Scotia, as well as the fur animal program here at the Nova Scotia Agricultural College.
The ranched fur industry is somewhat younger than the general age of agriculture. The silver fox industry, as was just mentioned by one of your members, began on Prince Edward Island in the 1890s and was a very significant sector of animal agriculture. The Maritimes have had a very important role to play in the history of this industry. Silver fox is a colour type of the common red fox species and represents a smaller segment of the ranched foxes. The Arctic fox is the main species being produced by the ranched fur industry.
If we look at the graph on the right, on global production, we have the fox production numbers from 1996 to 1998 showing about 4.6 million to 4.7 million pelts being produced annually. Out of this, Finland produces the vast majority.
Ranching of the North American mink species began in the U.S. during the 1770s and the important Maritime connection here is the birth of the Mullen Jet Black mink in Digby County, Nova Scotia, in the 1960s. We have very high quality genetics in mink ranching, specifically, the black-coloured type of mink.
Denmark is the world leader in the global market. producing around 41 per cent of all mink in the world. Their share of the total market, which is between 25 to 29 million annually — this year it is around 27 million pelts — is about 11 million.
The Canadian ranched fur industry produces about 1.4 million mink. The United States produces around 2.2 million, so we are a little behind. However, Nova Scotia's share of the national production is about 45 to 50 per cent, currently representing around 600,000 pelts annually. Last year's production was about 560,000. As you can see from this production graph for the period from 1987 to the present, there has been steady growth in the production numbers in the province since 1993.
Senator Hubley: Can I just ask you a question on the graph? Is there any indication there as to when the resistance to wearing animal skins became something of an issue? Can you tell from that graph?
Dr. Rouvinen-Watt: It was probably around the late 80s, early 1990s. It is certainly an issue in the overall picture, and I will talk about that later as one of the challenges. If you look at the fox production numbers shown here, there was a significant fox industry in Nova Scotia in the late 1980s, and since then the numbers have gone down. One of the primary reasons for that is that the fashion demand for long-haired fur garments has gone down; whereas the demand for mink has been more steady. Now there is some indication that it is changing and there is more variety being seen in the garment retail market.
It is very positive for Nova Scotia's mink industry that many of these farms have been in the same family for 60 to 70 years. We have young, new farmers currently entering the industry, unlike elsewhere in Canada, and so Nova Scotia has a very good future in mink farming. It is estimated that 400 people are employed full-time by this sector, and about 1200 gain seasonal employment during peak labour times such as pelting and the breeding season.
Total Canadian exports in this industry are worth about $290 million, out of which raw pelts represent around $150 million and the proportion for ranched fur is estimated to be between $80 million and $85 million. Roughly 98 per cent of all furs produced in Canada are exported, and the main export markets currently are Russia, China and Korea. This is expected to continue to be a very strong trend, as Russia especially is estimated to be presently one of the fastest growing economies. In their fashion tradition, fur has always been a key factor in winter garments.
If we look at the Nova Scotia mink industry in particular, there is currently a very strong price being paid for the pelts. Last year's estimate of the average pelt price was around $49. This year's crop has not been sold yet; there is a strong indication that a price as high as $60, and even up to $62, per pelt will be realized. The North American fur auction sale begins in Toronto next week, so we will know for sure then what will happen.
If we look at the farm gate sales in relation to the previous graph on the production numbers, they do not follow quite the same trend, as the price is newly established every year. There is no fixed price for the product. It is dictated by the laws of supply and demand in the auction situation, so the producers truly do not have any guarantee as to what their income will be from year to year. It is a risk-taker's industry — or a good financial manager's industry, whatever way you want to look at it. However, the value of farm gate sales last year was around $28 million, and this year, as high as $36 million can be forecast. This placed the fur industry above the hog industry in the province of Nova Scotia last year. It is a very sizeable income, and to a very small area of the province — about 85 per cent of all production is located in Digby County alone. That area has very few other possibilities for animal agriculture as they have less than half a per cent of all arable land in the province. It represents a very significant non-food animal agriculture sector in Nova Scotia.
I have isolated three of the current challenges that the industry faces, and the first one is bio-security and animal health. The industry is currently battling a health issue with Aleutian disease. This is a viral disease for which there is currently no vaccination, and the only effective way to deal with it is through testing. Our Department of Agriculture and Fisheries runs a counter-immunofluorescence test for this disease, and we can only depopulate and then repopulate affected farms with fresh breeding stock.
Distemper presents another challenge, as this viral disease is present in large numbers of wildlife, and if raccoons, for example, which are carriers for this disease, get access to the property, they can spread it.
I should also mention the security of property, which has become an issue in the last few years as a result of increasing animal rights activism. The producers are concerned about the security of their animals, their property, and the security of their future as farmers.
The next challenge that I want to highlight is environmental and animal management. We are dealing with environmental management issues both on site, during the production cycle of the animals, as well as off site, when the manure has been removed from underneath the pens. Carcass management is a problem with regard to rendering. I want to highlight that manure rendering plants currently have difficulty dealing with carnivore animal species carcasses due to concerns over, for example, the prion-transmitted diseases such as the transmissible encephalopathy. Composting is being looked at as a possibility for carcass management, the same as it is in the poultry and hog industries.
Production technology in animal housing will become of keen interest to the producers as they will be looking at more modern, more technologically advanced ways of raising and managing their animals.
The last challenge I want to highlight is the cost of production. Feed, as the largest operating cost of the ranch, is of utmost importance, and specifically, its availability and price. The industry makes use of waste and by-products from the animal slaughter, fisheries and food processing industries. However, the pet food sector can pay a higher price for the same product and competition is becoming quite tough. Labour costs are a concern in comparison to the cost of technology. It may sometimes be more feasible to put advanced technologies in place and then be able to do more with a smaller labour force.
Nova Scotia producers have already taken a step towards creating producer cooperatives. A pelting cooperative was established a few years ago that now handles over half of the pelt crop in the province, which means that a very high quality product gets put up for the market, and a feed kitchen would be the natural next step, where the wet feed manufacturing would be centralized.
I also mention industry infrastructure here as one of the challenges, especially the access to equipment and services that are very specialized. A lot of North Americans do rely on European technology, which can often be cost prohibitive.
Now I would like to move onto the fur animal research program that has been in place here at the NSAC, in the form of an animal research chair, since 1994, one of the industry partnership research chairs that have been established. The NSAC does fur research in collaboration with the Nova Scotia Fur Institute, an industry umbrella organization that brings together the Nova Scotia Department of Agriculture and Fisheries, the agricultural college, the Nova Scotia Mink Breeders Association and the Nova Scotia Fox Breeders Association. This group meets quarterly, discusses research and industry priorities and provides updates.
We have a fur unit at the NSAC that is in the process of becoming the Canadian Centre for Fur Animal Research with the support of the Canada Foundation for Innovation. We are the only fur-animal-specific research facility in Canada and there are very few facilities — not specifically dedicated facilities, but smaller research units — in the United States. We truly serve a national and a North American mandate in our program. I will give you a brief overview of the applied research and then the more basic research, as well as future directions.
Our main focus has been on the fur animal feeding, identifying and testing opportunity feedstuffs, primarily waste and by-products of the fishery and agri-food industries. We have a breeding program for the American marten, which was very recently designated an endangered species in Nova Scotia. We are also looking into reproduction in the silver fox, specifically the relationship of the temperament and mothering ability of the female to her productivity. We have a very high producing herd here on campus. Our average litter size of weaned pups is around 4.5 to 5 and the industry average is 2.9, so we have a really good story to tell there.
One future direction for the applied research program is on-site processing of spent hens, or end-of-cycle laying hens. We are looking into technology to enable the processing of the hen carcasses right on the farm and the preparation of either an acid silage or dehydrated product to feed to the mink. We have been working on this since 1998 and are now moving towards a pilot project. The study has been on a laboratory scale until now.
We are also looking into funding for an applied feeding guide. The industry needs a very practical feeding book on designing rations and also an inventory of available feeds and their nutritional value.
Basic research is focused in two different directions. Under Dr. Farid's leadership, the breeding and genetics side has developed DNA fingerprinting techniques for the mink, as well as micro-satellite markers, which are short repeats of DNA that can be used as genetic markers.
On the nutrition and physiology side, which is under my leadership, we work with digestive physiology and nutrient metabolism, as well as thermoregulation — looking into hypothermia, for example, in the neo-natal mink — and skin and hair histology. We actually look at the pelt quality at the microscopic level.
The future direction for these two programs includes genome mapping for the mink, which is a very ambitious undertaking and would consist of QTL mapping, or quantitative trait locus mapping, combined with trait characterization. The goal of this research is to develop genetic markers that can be then linked with an economically important trait and used in animal breeding. The time frame is probably between 10 and 15 years, so we are talking about something very long term here.
Regarding the nutrition and physiology on-site research, we will be working with a disease called mink nursing sickness. There is a very strong indication that this lipid and glucose metabolism disorder is very similar to the obesity type 2 diabetes syndrome. It is an acquired insulin-resistant type syndrome, so this may provide us with a very interesting model to work with in understanding the regulation of lipid and glucose metabolism and allow us to be part of a larger undertaking that may have implications for human health as well.
I have put the research program challenges into two categories and they are both funding related — infrastructure funding as well as operating funding. Infrastructure at the NSAC consists of the fur unit that will become the Canadian Centre for Fur Animal Research as we get our new infrastructure in place. Funding has been primarily provided by the Canada Foundation for Innovation as a result of a national competition in 1999, and this has been matched by the Canada-Nova Scotia Co-operation Agreement on Economic Diversification. We do get industry funding support for this as well. The provincial mink industry is donating the breeding stock for the new facility.
The industry is very hard pressed to find funding for these kinds of endeavours and most national and provincial funding programs now require 20 to 25 per cent industry funding. This is a very expensive responsibility to place on the industry; therefore we will have a big challenge in looking for various funding sources and helping the industry support us in this.
Once we have the infrastructure in place, we naturally need funding to support the animal care and maintenance of the facilities and the NSAC fur unit institutional budget will provide that, whereas the research carried out in the facility must all be self-supporting. That means it is the researcher's job to find the monies to the pay the students' stipends to get the laboratory work done and so on.
We have received, and are in the process of applying for, funding support from the Nova Scotia Department of Agriculture and Fisheries Technology Development Program. They have been very supportive of the fur animal research done at the NSAC. Various agri-futures and adapt councils are currently supporting us in the hen carcass feedstuff preparation — Nova Scotia, New Brunswick and Newfoundland are included in that. The Canada Mink Breeders Association pays 25 per cent of the monthly costs for my position, but my salary is supported directly by the industry. The national granting agencies from which we are seeking funding include the Natural Sciences and Engineering Research Council of Canada and the Atlantic Innovation Fund, which is locally administered by ACOA.
I will gladly answer any questions that the committee has for me.
Senator Tunney: I was surprised to hear that Russia is one of our customers for ranched furs. I have seen a lot of ranched mink in Russia and the conditions under which they produce them are horrible. They tell me they have so many health problems that a lot of the mink will die in a short time. I think it is mostly the unsanitary conditions.
Russia is the largest producer of wild fur in the world, and they probably have the best in the world because of the climate. Do you produce better quality fur here in very cold temperatures, when the fur naturally gets longer and thicker? Do you notice any difference between then and a winter when we do not have the normal cold weather?
Dr. Rouvinen-Watt: There are quite a few questions there. First, I have not had the privilege of seeing any Russian fur farms, so I cannot really comment on that, but would expect that as an economic infrastructure crumbles, animal welfare would suffer in the same way as human welfare.
Regarding producing high-quality mink, I believe a more moderate winter climate is more beneficial to the animal than a really harsh one, and therefore, the fact that Digby County, Nova Scotia, has become a mink producing area is not a coincidence. The winters tend to be not quite as harsh as elsewhere, which means that the animals can continue eating, and that can then support the growth of the fur and nourishment of the skin and the hair follicles.
From a physiological standpoint, the growth of the fur is governed more by the changes in the light/dark cycle, the photoperiod, than temperature itself. Therefore, a really cold temperature would be an impediment because the feed would freeze. This is a by-product-based wet diet, so the animal would not have access to the feed and would not be able to maintain as good a body condition as in milder conditions.
Senator Tunney: How is our fur sold? By auction?
Dr. Rouvinen-Watt: Yes, it is sold by auction. On the ranch, or in a central pelting facility such as a few producers now use cooperatively, the animals would be killed. They would be skinned and the skins would be fleshed, cleaned, stretched on drying boards and dried. They are called ``pelts'' at that point. Technically, they would be non-dressed, dehydrated, raw hides. They would then be collected at regional shipping stations — we have one here in Truro — where each pelt would be labelled with a bar code tag so that it can be identified with the producer. Every producer of ranched fur needs a producing licence as well as an export permit; and a wild fur trapper needs a trapping licence and an export permit. The product would leave the province as an export product.
All of these furs would arrive at an auction sorting facility or warehouse, and North American Fur Auctions has one in Toronto. There the furs would be matched to identical type, colour, length, and quality, which would be the texture or the silkiness of the fur. What is the colour shade, the fur density and so on? These would be made into a bundle, about 30 to 50 pelts per string. This would represent the number of pelts required for one garment. The purpose is to provide the furrier or designer with raw material with identical characteristics.
Then there would be show bundles. There would be maybe thousands of furs of identical quality, and a show bundle would then be displayed to the potential buyers. They will examine the pelts and make their notes about what either their furrier or design house wants for that particular season. They would then place their bids at the auction and probably have a maximum they are willing to pay. The auction house also has a minimum, below which they will not sell. The price bidding can get quite fierce if it is a very desirable type of product.
Senator Hubley: I had the same view as Senator Tunney on the climate. I always thought that the colder the climate, the better the pelt. It seemed to me they still do market some silver fox in P.E.I. and that the Hudson Bay Company is involved. What would their role have been? They seem to come to Prince Edward Island; I thought they came right to the Island and bought fur. Now would they have then taken those furs back to Toronto and would the process continue?
Dr. Rouvinen-Watt: Yes. Hudson's Bay Company is part of the North American Fur Auctions now; Hudson's Bay used to deal more with the wild than the ranched fur.
Senator Hubley: Do you deal in sealskin as well, or is that just a Newfoundland phenomenon? What other species do we have here in the Maritimes? We do not have the sheared beaver, do we?
Dr. Rouvinen-Watt: The wild fur sector would deal with beaver, muskrat, otter, bobcat and coyote. Those would be the top species number-wise. The sealing industry is not really connected to the ranched or wild fur; I understand it is still within the Department of Fisheries in Newfoundland.
Senator Hubley: The two main species then would be the fox, either silver or whatever other colour, and the minks?
Dr. Rouvinen-Watt: Yes, yes they are.
Senator Tkachuk: I have two questions. One, you had said that most of the pelts were exported. Are there not manufacturers of fur coats in Canada? We are always talking about value-added, so I thought I would ask that, and if so, what percentage is bought here?
Two, you said you were going to expand a little on the animal rights activism and what kind of impact that has had on the business, and I am wondering if you could just kind of update us on what is happening now with world attitudes.
Dr. Rouvinen-Watt: Certainly. Firstly, to address your question on garment manufacturing, there is indeed a sizeable garment manufacturing industry in Canada and it is located in Quebec, specifically, in Montreal. Montreal has been a fur-trade centre since the early 1600s. The total fur exports that I mentioned were worth $290 million, and raw pelts were $150 million of that. The difference is actually the garment value.
Senator Tkachuk: That is the industry here?
Dr. Rouvinen-Watt: Yes. Now the reason why the raw pelts are considered an export market is that all of these auctions are international. Some of those may end up in the hands of Canadian designers later, but they would be sold to an international buyer. It depends on how the system works. Consumption and production in the fur trade are quite stable in North America. About 12 per cent of world production and 12 per cent per-pelt consumption take place in North America. So it is, in that sense, fairly similar to a domestic market, yet it is an international export market at the same time.
Senator Tkachuk: The animal rights activists?
Dr. Rouvinen-Watt: Yes. There has been some activity against the fur industry over the years, and there have been some, what I would call ``terrorist attacks'' against property and this form of animal agriculture in Canada. We have not had any such incidents in Nova Scotia, which does not mean that it will not happen. The movement has been more active in Europe. There have been a few incidents, I believe, in Denmark and Holland, where animals have been liberated from the farms. Usually, no direct damage is done to the animals, but once you release an animal from its farming environment, it is likely to be run over on the highway. Similar incidents have taken place, for example, in British Columbia, where a mink ranch was targeted and animals let loose.
I do not know what aspect specifically you wanted to know about.
Senator Tkachuk: I know there was a lot of publicity when this started happening in the late `80s and early `90s, and I thought it affected the fur industry quite dramatically. Has it had a real effect? I notice the numbers are going sky high.
Dr. Rouvinen-Watt: I think it has had a perceived effect in that people know that it is there, but I do not think it has had an impact on the demand for fur worldwide. The world consumption of mink has been very steady at around 25 to 27 million pelts every year throughout this activism.
Senator Tkachuk: Is that because in Russia it went up and in Europe it went down?
Dr. Rouvinen-Watt: Probably. That may have something to do with it. The traditional markets in Europe are perhaps consuming less, but then the Asian and Russian markets are consuming more, so overall the balance has stayed very much the same. My personal view is that there has been a lot of bad publicity that was perhaps not founded on factual information, and we would like to see consumers making educated decisions. There is certainly work to be done in providing information from the industry to the consumer to counteract some of these false accusations.
The Chairman: Ten years ago, it was not too fashionable, but it seems that the pressure against ladies wearing furs is not as great as it was. There has been talk in the committee here about farmers and other producers advertising their produce and value-added. Are you thinking of doing any advertising?
Dr. Rouvinen-Watt: Of our program?
The Chairman: Yes
Dr. Rouvinen-Watt: It is certainly important to us to have a presence in the public media and information about who we are and what we do. We have always had an open-door policy here at the college. We invite people to see our facilities and visit our research program. We have a presence on the Internet; I guess my view is that we have a good story to tell and would like it to be out there. The fact that we have young people interested in getting their education in this field, pursuing masters and Ph.D. studies, tells me there is a future for the industry.
The Chairman: Your average reproduction is four?
Dr. Rouvinen-Watt: That is correct, roughly, for the mink.
The Chairman: Around four, between four and five?
Dr. Rouvinen-Watt: Yes.
The Chairman: Your average price is between $40 and $60?
Dr. Rouvinen-Watt: Yes.
The Chairman: That means that production would be about $200 for one mink. How many mink does a producer have to have to be profitable?
Dr. Rouvinen-Watt: The pelt price would determine that. I cannot remember a number off the top of my head. It depends on the reproductive performance, as you mentioned, because you have to take into account the investment you put into the breeding stock. The higher your reproductive performance, the less money you need to get per pelt to make ends meet. If I refer back to the Farm Management Analysis Project results, there are a few producers in Nova Scotia who participate in that through the economics and business branch. They would have around 580breeder females per person equivalent on the farm, and I believe the average net income was in the $150,000 range for last year. That information is available if you wish to have it.
Senator Day: Your comment with respect to young people studying reminded me of a question I wanted to ask. In the early part of your presentation, you talked about new, young people coming into the business and family farms. Do you recall that part? I was wondering at the time if, as in the past, this was a supplement to other forms of farming, or is this the core activity for farmers coming into the business?
Dr. Rouvinen-Watt: Mink farmers tend to be full time. At least, that is the indication. There are some producers who have other interests on the side, but they primarily derive their income from mink farming.
Senator Day: And fox farming? At one time, all kinds of farmers would have a few foxes on the farm, you know.
Dr. Rouvinen-Watt: That has been a big difference between the two industries. Fox farming has been, for the most part, a part-time endeavour based on a dry pelleted diet bought from a feed company and really more on the hobby farm scale. The mink farming has been a full-time occupation, and the fact that we have over 100 licensees, but only around 60 farms, tells you that there are fathers with a couple of sons doing business on the same farm, but having different production licences.
Senator Day: Your comments about young people coming into the business and family farming referred primarily to the mink farming business?
Dr. Rouvinen-Watt: Yes.
The Chairman: I want to thank you for appearing here today and we appreciate you coming. Honourable Senators, coming before us now is the Honourable Ernest Fage, Minister of Agriculture and Fisheries.
Hon. Ernest Fage, Minister of Agriculture and Fisheries, Government of Nova Scotia: Honourable senators, it is a real pleasure to be here.
I would like to start my presentation this afternoon with a little nostalgia. This particular facility here is one of the gems of the province and Atlantic Canada in agricultural research, training and teaching. As a former student, while I was driving up today, I was remembering graduating here in 1973 at 19 years of age, and the then minister, Eugene Whalen — it was the first of a number of occasions on which I met him — was here as a guest lecturer and to open a facility. I think some of the issues the former minister raised are still pertinent. They included farm income stabilization and the regeneration or turning over of family farms. We saw the establishment of supply management shortly after that. I think the main goal for the industry that we all strive for as elected officials is farm stabilization in rural communities across Canada. The former minister was a great champion of that and certainly of the agricultural community. The issues that he attempted to address, and did address, are, of course, always ongoing as time and opportunities change the scale of the industry and the participants. I believe they are still the ones with which you, other committees and governments must wrestle.
I have not had the opportunity to review any of your other witnesses' presentations, but I would like to give a quick overview of the industry and relate it to some of the questions that you stated would be discussed. First of all, to give you an idea of the industry here in the province, the total agri-food sector is worth about a billion dollars to our economy annually, which is certainly significant for a province of this size. The actual farm income at the production level last year was about $420 million, and the federal forecast is roughly that same size, with some variation in different sectors because of drought-related problems that we encountered last year.
We employ about 15,000 people in the provincial industry. Nova Scotia has the highest number of farmers per capita with an undergraduate degree in agricultural science disciplines, and we are quite proud of that. Obviously, this institution ties in very closely with that.
With supply management accounting for about 55 per cent of output in this province, many of the products here tend to be for domestic consumption and not export oriented. However, we do have some sectors involved in agri-food exports and we do see it as an area of opportunity. Our annual growth rate since 1994 has been about 12 per cent and it is currently worth approximately $175 million.
Some industries are major leaders, not only in North America but worldwide, including the wild blueberry industry here in Nova Scotia. Oxford Frozen Foods completed a $70-million expansion last year and that particular group of companies exports worldwide. Wild blueberries are very significant, not only in Canada, but the U.S. market as well. They have significant holdings there, and we are very pleased that with the expansion, some of that product will be processed in Nova Scotia instead of Maritime production heading south of the border. We see important growth opportunities and the value-added occurring in that particular industry.
Apple Valley Foods is also a major supplier of fruit pies, and there are other, related opportunities there. They offer an opportunity for growth in agricultural output, but the important part, from the point of view of jobs and stability of rural communities, is that they conduct their business here at home.
As for overall competitiveness, we have challenges here in keeping up with technology. Profit margins between production and the market price are decreasing. Those are challenges that the industry faces across this nation. Many agriculture technologies are now location specific. More and more expertise is required to address the needs of the farming community.
This province is poised to balance the budget this year for the first time in 40 years, so over the last two years, since our administration came to government, we have certainly had to be innovative, adaptive and look at different ways to satisfy the needs of the participants and the constituents in a number of departments. Agriculture is no different.
We have moved to alternative service delivery for expertise, and at this point, the industry is responding with a significant uptake of those arm's-length services. A board of directors, the majority of whom are farm leaders, and on which the college here is represented, now does the hiring of agricultural specialists in this province. They have the ability to locate specific expertise for any given time period for a specific operation, so that it is timely and can be accessed for unique, time-sensitive situations, rather than generalists trying to address problems for which they may not have the specific expertise. Those are some of the challenges and some of the solutions that we are looking at within our fiscal envelope.
The other issue is that farm debt is increasing. There are a whole host of reasons why, but given the makeup of the industry, and with supply management, milk and dairy require very specific food safety precautions. There are other reasons, such as high-cost buildings, and some of that debt has been incurred in the renewal of that industry. However, overall farm debt continues to increase and is obviously a concern to the industry.
You also had a question about the 2001 drought, but I will be brief on that because I would sooner we had time for questions and answers, particularly on policy. We have encountered drought conditions over the last four or five years that are extremely abnormal for this province. The farm community has traditionally invested a huge amount of money in making sure of getting the water off the land, from the tile drainage to perimeter ditching, in most fields and canals to eliminate that surface water. We found ourselves in the unique situation, especially last summer, of a very deficient rainfall. Therefore, whether that proves to be short term or long term, we are approaching it with a water strategy.
Mr. Lyle Vanclief agreed with some of the arguments we have put forward over several years in regard to that, and PFRA funding was made available for the first time last fall. We are very pleased that the federal government is beginning to engage with us on an overall water strategy to address those types of situations.
On the question of the national farm action plan, the provincial government and the industry see it as a very proper and viable move. We are looking at the five principles of renewal, environment on farms, food safety, science and research, and risk management or safety nets. We very much agree with developing a national philosophy, standardization between the provinces and a fair sharing of responsibility between federal and provincial governments to work on those issues, but to also improve the overall opportunities for participants in farm-related operations across this province.
The fourth question was about the state of research, and I know certainly some of the presenters here were from the agricultural college, but I just want to touch briefly on the fact that we have a number of national chairs centred here, working on everything from environment to organic agriculture to a whole host of industry-specific topics. We certainly view that as a wonderful opportunity to provide needed research in agricultural development as well as increase the competitiveness of our products and services. It gives us an opportunity to adapt that to the needs of Nova Scotia and Atlantic Canada. When you get into a number of specifics in agriculture, for example, the differences between the climatic zones in this country, you need specific research for the farming community.
The last thing that I would like to comment on is an issue that I think has to be addressed in agriculture, in rural communities, not only in Nova Scotia, but also across this country. Risk management and other tools have traditionally been output based, and that works very well for full-time, commercial operations. However, in Nova Scotia, we tend to have many more mixed farms than monoculture type operations, so a whole-farm approach sometimes presents difficult challenges in addressing specific crops and the diversity we want the farm community to have. If we become too dependent on it, it forces those operations to go to monoculture, which increases the risk, and that is not what we are trying to achieve.
In Nova Scotia, 15 per cent of agriculture output is generated by 85 per cent of the population. The reverse is also true, with 15 per cent of the producers accounting for 85 per cent of output. That average is very similar for most other provinces.
As the average age of farmers in Nova Scotia is early 50s, there is a pressing need, and across Canada as well, to address those 85 per cent who produce the 15 per cent of the output. They are the ones who maintain the rural infrastructure in Nova Scotia because they keep this province green and provide a lot of support for collateral industries such as tourism, for example. We have to recognize that an output-based system does not satisfy income support needs for that 85 per cent of the farmers in this province. If you examine most other provinces, you will find the same rationale. I think that is our challenge going into the future.
We have some good, full-time commercial operations. I think we have to take another look at that 85 per cent that may be totally output based. Risk management or income stabilization programs really do not suit them or allow them to continue into the future.
I will attempt to answer any questions.
The Chairman: I want to thank you for that presentation. As you said, your problems in agriculture are much the same as those across Canada. I know that only 30 per cent of your farmers were taking crop insurance. I believe in Saskatchewan it is 55 per cent, maybe a little higher. The problem in Saskatchewan, at least, is that crop insurance does not really cover the input costs and so on. The averages for which we are covered are far too low, and of course, that tells you something about the whole industry. We have more farmers between the ages of 70 and 75 than between 20 and 25, and that also tells you something about the industry.
What is the answer?
Mr. Fage: Well, ladies and gentlemen, you are much more learned than I am, so I was hoping that the conclusion of your hearings would probably produce some answers. To make a comment rather than give an answer, when we look at the structure of the industry and how we are going to address those particular producers, I am sure each province has roughly the same variation on crop insurance.
In this province, 50 per cent of the premium — and we insure every crop — is paid by the federal and provincial government, so the producer has to pick up the other 50 per cent. It is done on proper actuarial statistics, and so you end up, as you have pointed out, with limited coverage or producers going for 60 per cent instead of the 85. The ones that do enrol generally do improve their five- and ten-year average, so they get into the higher coverage rates at a lower cost.
I think that adjustments in mixed farms in this province would be helpful. This is not a grain-growing province; it is a grassland province. Modifications on derivatives, so that you can insure against particular perils, may be a solution to getting more producers involved. As with weather peril, you would insure, instead of just the standard, every acre of grassland. In Saskatchewan, you would have rangelands that have not been turned over in 30 years. There is a lot of natural pastureland and those types of things. Producers, once they have that mix of older producing soils and ones that were planted this year or last year, tend to feel there is no sense applying because they will never receive a payment at the end of the day. In order that costs can be controlled, we have to somehow get them into the higher insurable categories. Obviously, there have to be some caveats there, including wanting to increase production.
Senator Wiebe: Would you mind if I asked you a tough question?
Mr. Fage: I like all questions; it is more whether I give a good answer or not.
Senator Wiebe: I have asked this question of the ministers of agriculture for Manitoba, Saskatchewan and Alberta, which is my part of the country. You know we are searching for ways to keep our farms viable, especially that 80 per cent that we talked about. Our farmers adapt very quickly, and we have been calling on them to diversify, but they really are now at their wit's end as to what to diversify into. You find a niche market, and it does not take very long, if you make some money at it, before your neighbours are into the same niche market and you are no longer making money.
Some of the states in the U.S., I believe 12 of them, have mandated that 5 to 10 per cent of the fuel consumed in the state contain ethanol. I understand that ethanol from potatoes is very efficient. Is your government looking at something similar to that as a means of providing another market for what is being produced here?
Mr. Fage: That is an extremely good question because it deals with the opposite end of the spectrum. The only real solution, at the end of the day, is being able to brand or establish a product that you can market at a premium, especially given the scale of agriculture in this province. I am sure you are well aware that with grains specifically, or anything that becomes a commodity over the long haul, the only opportunity is to value-add, because commodity prices have always tracked downward as technology and volumes of scale have come into play. Anybody who does not have the expertise to value-add is always in a chronically low-income situation.
Looking at other things that I am responsible for here, I would say that Atlantic salmon is now in the commodities market. Our growers need to value-add to get that extra out of the marketplace, whether it is through smoking or a variety of other things. On the marketing side, we set aside a number of dollars a year ago to do specific studies and analysis of the American market.
The real opportunity for this province, if we are going to become free traders, is that there are 40 million to 60 million people in the Boston/New York corridor just down the coast from here with hard currency. Our strategies, whether for gas and oil or agriculture, will revolve around taking production that may be significant here, but may only garner 1, 2, 3 or 4 per cent of that market, to the U.S. To be successful, whether with an organically grown product out of Nova Scotia or the Maritimes, or a specific, branded product like Annapolis Valley apples or organically grown pork, we need to do that specific study on the United States right now. We see that as the opportunity on strictly the farm side.
I will add a comment, though, on the other side. If the will is there, I certainly see opportunities in agriculture for those producers who want to be in the tourism business — farm vacation, bed and breakfast — to help stabilize those operations. Many of them are that size, because whether it is the capital, the management or the market, we have to be realistic about their opportunity to grow their operations at an average age of 55 years.
Senator Wiebe: Part of my concern as a farmer is that our federal and provincial governments are looking at ways in which we can market what we produce. We are producing food off our farmlands. It is not subsidies. Part of our problem is that we are overproducing. We are too good at what we do. If we do away with all subsidies, what is the farmer going to do? The farmer in Europe is still going to seed canola where he seeded canola last year. The farmer in the U.S. will still seed durum because he has to do something with his land. That is why I asked this question about ethanol, because there are only so many countries that can afford to buy our product. What we are really doing is providing cheap food for countries like Japan that do not have the land base to grow their own. Therefore, instead of competing against each other as farmers, should we not be looking at competing with the oil companies or some other sectors and finding non-food uses for our farm products?
One presenter last summer got me thinking about this. He said there is nothing that can be produced out of a barrel of oil that cannot be grown on a farm. Maybe we should be looking at — and I just wanted to know what you think — investing more money in research at our universities and experimental farms to find ways and means to use what we produce on our farms for other purposes. We might prove to be more successful there in the long run because we could develop markets in the U.S. We give that apple a little extra shine, put a different sticker on it and we are going to be able to sell it. However, it is not going to take very long before producers in B.C. decide that they are going to use the same polish and the same sticker. Then we are competing with them in that market.
Look at what is happening with potatoes. Newfoundland, as Senator Day reminded me this morning, produces excellent potatoes, along with Prince Edward Island. However, all of a sudden, we are now starting to grow potatoes in a big way in Saskatchewan. Saskatchewan producers are now competing with potato producers here in the Maritimes, which I do not think we should be doing. We are asking our farmers to diversify and we are really competing with each other. Somewhere along the line, I think we have to sit down, and rather than throwing dollars at people to keep doing the same thing, and find things to do with the food that we produce other than eat it.
Mr. Fage: I could not agree with you more. First of all, when we look at alternatives, including life sciences and pharmaceutical uses, there is a huge opportunity for research. Those types of benefits could certainly be researched on a small scale and communicated to growers with the expertise to assimilate that type of production.
We have to think long term on research when we are dealing with ethanol or other uses, because obviously, at the end of the day, it has to make economic sense. We are competing globally to lower our costs within a structure that is workable. I have a number of portfolios. I am also the Minister of Energy for this province, and certainly when you look at long-term energy uses, new types of windows, there are opportunities there. Hydrogen cells and other forms of energy appear to be on the horizon 40 to 60 years out. Fossil-based production has really peaked and now we are working on major reserves. I think we need to include all those things in our long-term strategies for research. In the short-term, I believe there is economic sense and certainly opportunities there.
I think the second part of your comments hearkens right back to the concerns of the Honourable Eugene Whalen on marketing systems. What strategy does a participant in agriculture employ? Sometimes, that may be at odds with what governments or other sectors might want. The only day you control the price is the day that you control the supply. Marketing systems that empower producers, whether through a cooperative effort or other variations, give them the ability to bargain on price because they have some control over supply. That is a very difficult balance to achieve.
Senator Wiebe: I am a very strong supporter of the marketing system. However, that applies only to foodstuffs that we can sell within Canada. Once we start exporting, we cannot guarantee the price, which is why it is better suited to milk and eggs and poultry. Out West, where we grow wheat and durum, there is just no way that we can do it.
To be fair to you, I should tell you what responses I got from the other three ministers. It is amazing how similar they were. Each of them said that yes, they feel there is quite a future for ethanol, and will do everything possible to encourage its development in their province, but no, they were not prepared to mandate it.
Senator Hubley: We certainly have discussed a wide range of subjects, but you have brought another one to the table this afternoon, that of farm debt. We have heard consistently that when the primary producers cannot get a reasonable return for a certain commodity or the cost of production, it is not surprising that we have farms that are in debt. What do you think governments can do to help out in these situations?
Mr. Fage: Certainly, I think an industry carries some structural debt in normal financing of operations. That has been the case in the past and will be in the future. Government certainly has to play a role in the ones mandated by food safety, environmental concerns and water quality. Governments, taxpayers and citizens rightly have concerns, and as more significant environmental, food safety and water quality concerns come to the fore, legislation is enacted to deal with them. I believe governments have to look for ways to help support primary production in an open, global marketplace. It is extremely difficult to recoup the extra financial costs of ensuring that we are number one in the world on food safety in a marketplace when you are selling for 1 cent lower per unit than someone else. Obviously, I feel strongly that government needs to protect the environment. On the other side of the coin, governments and citizens who require that on an uneven trade playing field also have the responsibility to keep those circled in international or WTO trade regulations, if they are green. There can be some offset from general revenues of provincial and federal governments to help support that. Those investments are going to drive costs above the capital structural costs and will be very difficult to recoup, given that the competition in other countries or jurisdictions may not face those costs.
Senator Hubley: I am not totally familiar with the European Union's subsidy plan, but I know from our discussions that they do cover farmers' environmental costs. I also think that the farmers really have their backs against the wall, in that they can no longer absorb the costs that they will incur in meeting the demands of environmental control and still make some sort of a living off their farms. I have to add that they really are a very positive and wonderful group of people, our farmers, and they seem to be facing big problems these days. I believe that it will be incumbent on governments to come forward. I am not saying there has to be a subsidy, but I think that they have to partner with the farmers in addressing some of these concerns that have come to the fore lately.
Mr. Fage: Your comments are well founded. Those are ones that need to be tackled and dealt with as we move forward. We have to have the underpinnings for our farm community to be competitive on a global basis. The trade agreements have been signed, and from my point of view, if they are going to proceed — and I see no reason why they will not — we have to have trade tariff equivalents. I do not expect them to rise with each round of the WTO. I expect to see them coming down. If we have the most stringent food safety and environmental protections, which we should have and are proud of, we have to have some investment there to cover that off.
Senator Tunney: Minister, you mentioned Eugene Whalen two or three times, a mutual friend of ours. We remember Eugene Whalen for some very unique qualities. He was the most defensive and, when necessary, offensive proponent of agriculture and of farmers. He was admired for speaking out. At a meeting in Winnipeg one night, when somebody got up to criticize the price of I forget what, he said, ``I have to tell you consumers, you either get used to paying for your food or try to get used to doing without it.'' He did not fully succeed there, because in many cases, farmers are still not getting their share of what the consumer pays for and takes home from a supermarket. That is the strength in supply management, of course, as you know.
You just need to look at the financial statements of the processors and retailers to realize that they are doing very well. The problem is, they are not willing to share the profits with the people who produce the food. The producer of a bag of potatoes has control of that from the year before, when he keeps it over winter, plants it, grows it, harvests and bags it. The retailer does not want to have that in the store for longer than 48 hours. Of course, the retailer will make more on it than the producer can expect to make. I believe there is a problem when 41,000 private wood lot operators in New Brunswick are getting 70 per cent of the price that the processors are willing to pay the big operators. Farmers are not really getting a fair deal. All I can say is, I wish you luck in your efforts to help turn some of that around.
Mr. Fage: Your comments are bang on. There is no question that the challenge as you have outlined it exists. Atlantic Canada has the lowest food basket prices in the country at the retail level. We have two large retailers here and the competition is very intense. For all intents and purposes, the other chains have been in decline or retreat. The two have well over 85 per cent of the market. That points again to marketing strategies and organization. The real challenge for our horticultural producers, our fruit producers in this province, is to plug into a regional, not a provincial market in this part of the country, with those retailers wanting to virtually sign 12-month contracts. We have a number of marketing strategies that try to help those producers stay in the game. They have formed limited co- ops or limited companies. Getting shelf space is probably the biggest challenge because of that retail pressure. We need to find a method by which the primary producer gets a fairer percentage of the dollar, perhaps through some formula setting out that it will be a third, a third and a third, or whatever. I think it is going to be debated long and hard in government and producer circles, because when I meet with producers of non-supply-managed commodities in this province, they echo some of the sentiments you have just expressed. How can we work with government, the suppliers and retailers in divvying up that share a little more fairly? I do not have an answer for you yet, but your outline of the problem is crystal clear.
The Chairman: Is it not really a political solution? I am not talking about Liberal, Conservative, NDP or whatever. I am talking about the fact that rural Canada has a declining population. Our urban centres are getting ever larger. There are no longer any voting pluralities in the rural areas, so why would government bother taking the monies out of the fishery resources, lumber, oil, gas, agriculture, potash, minerals and everything that comes out of rural Canada? This is all rural. Yet the monies are all funnelled into the urban centres. I realize they have problems, but sooner or later there will be a countdown day here.
In Saskatchewan, for instance, the numbers show that there has been very little profit, if any, to the farmers for a number of years, and this cannot go on. There will have to be a political solution.
When I first got into politics, Alvin Hamilton, whom everybody knows, said, ``Len, there is an undeclared war between the urban centres and rural Canada.'' He said, ``It is very serious.'' That is about where we are at. However, how will you get somebody who has to get elected in downtown Toronto, Montreal, Edmonton, Calgary or Vancouver to understand that? Yet we are facing a national crisis that I believe we will pay for.
Now for some reason, the United States and Europe understand that and they protect their heartland.
Our committee was in Europe three and a half years ago, where we were told, ``Well, you people just do not understand what it is not to have food. You people in North America have no appreciation for food. We have faced starvation two or three times and we are never going to let it happen again.'' From a political standpoint, it is not going to happen.
Our current Minister of Agriculture is asking if it would be possible to roll all our programs into one and make it sufficiently effective to give some security to the farmers. I do not know if that is possible. Twenty years ago, there was an attempt to get provincial governments to join with the federal government to develop a program. What happened? I think Alberta opted out first, and then Ontario, and it never came to pass. We will face these kinds of things until we decide there has to be a solution. We just continue to hold more meetings. It is a very serious situation, Mr. Minister, as I am sure you realize.
Mr. Fage: I have flown into Saskatoon and rented a car and driven out to Regina and I certainly saw the extent of the depopulation. Although this province is not as vast, I agree with you that every province more or less faces the same set of circumstances. Fifty per cent of the population of this province, close to half a million people, live in the Halifax area. If you leave out Sydney at the other end of the province, you are left with large towns like this, like Amherst and Bridgewater. That gives you an indication of how small the rural population is. All provincial governments in the last two or three years have had cost sharing on programs, and I believe financial necessity, not policy, has driven it. That much has been achieved. However, if you are not willing to get involved in controlling the market side of it, it is very difficult to write an insurance policy on the production side. The two ends have not been tied together.
Senator Day: Do you have any Crown land in this province that is under licence and being farmed?
Mr. Fage: The arrangements we make in this province for Crown land generally involve something like blueberries. We rarely get into lease arrangements. Crown land here accounts for only 25 per cent of the landmass, so it is always under extreme pressure from all users, from recreational to industrial. If a producer identifies an area of Crown land that might be suitable for some type of agricultural production, there may occasionally be an outright sale. Normally, we would ask that producer to acquire another piece of property that was ecologically sensitive or in another Crown zone and do a trade.
Senator Day: We have been hearing a number of stories about farms going out of production. We also heard that in some areas, those farms are being planted with trees. Somebody is buying up the land and planting trees. Do you have any programs to either discourage or encourage that kind of activity?
Mr. Fage: Here in Nova Scotia, over the last several years, productive 2 and 3 class soils have largely stayed in agricultural production. However, the Christmas tree industry here is a large one, and some marginal soils have gone back to that type of intensive management. There is no outright program to develop farmlands into forests.
I am something of a history buff. The depopulation of rural Nova Scotia mostly occurred between the end of the First World War and 1950. Records show that probably one-third of those lands were abandoned then. If the soil were acidic enough, those lands became blueberry operations, but the vast majority returned to farmland and would be private, commercial harvesting and forestry operations at this point.
The Chairman: We want to thank you, Mr. Minister, for appearing. We are very appreciative of the college entertaining us here and being so kind to us. I might just say that if you have any extra money for research, do not forget the college. I do believe it is very important that we start funnelling some funds into agriculture, rural Canada and institutions like this. Until the Canadian people grasp the importance of it, not much is going to change.
Mr. Fage: Thank you very much for your kind comments. We are indeed very proud of this institution here. Obviously, I look forward to having your committee as an ally in that discussion over where funds should be allocated at all levels of government. More precisely, hearings like this offer an opportunity to engage Canadians in a wide- ranging fashion and raise public awareness. It gives governments the push that they need.
The committee adjourned.